Research by Cao and data from Mergerstat showed that LBO premiums were less than M&A premiums.

Question

Quizplus · Accepted Answer

Research by Cao and data from Mergerstat indeed indicate that Leveraged Buyout (LBO) premiums tend to be lower than the premiums paid in broader Merger and Acquisition (M&A) transactions. This is generally because LBOs are often targeted at undervalued or underperforming companies where the buyer can leverage the company's assets to finance a significant portion of the purchase price, whereas M&A premiums can reflect a broader range of strategic premiums for synergies, market expansion, or technology acquisition.

Research by Cao and Data from Mergerstat Showed That LBO