A Leveraged Buyout (LBO) is an acquisition in which a buyer uses a significant amount of borrowed money (secured and/or unsecured) to fund the purchase price, with the target’s cash flows and assets often supporting the debt. In private equity, a Leveraged Buyout (LBO) aims to amplify equity returns through Leverage (Debt), and Leveraged Buyout (LBO) structures are sensitive to interest rates, covenants, and operating performance.
