A leveraged buyout is when a group of investors use equity to buy a highly leveraged company that is in distress, and pay down the debt using their equity.

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A leveraged buyout typically involves using a smaller amount of equity to finance the acquisition of a company with a larger amount of debt. The investors then aim to increase the profits and cash flows of the acquired company to pay down the debt and increase the value of their equity.

A Leveraged Buyout Is When a Group of Investors Use