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Acquisition of a company by investors and the company's management team, using
a combination of equity and debt. The debt component is repaid from the cash flows
generated by the acquired company.
There are several types of leveraged buy-outs:
MBO (management buy-out):acquisition of a company alongside the management team (one or more managers
who are either non shareholders or minority shareholders)
MBI (management buy-in): acquisition of a company by an external management team
BIMBO (buy-in-management buy-out): acquisition of a company by an external management team in partenership with
the vendor and/or the company's management team.
OBO (owner buy-out): acquisition of a company by a vehicle owned jointly by the business owner and
the financial investors.
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