Leveraged buyouts (LBOs) occur when a firm's managers, generally backed by private equity groups, try to gain control of a publicly owned company by buying out the public shareholders using large amounts of borrowed money.

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Leveraged buyouts involve acquiring a company using a significant amount of borrowed funds, often with the aim of taking the company private, and are typically orchestrated by private equity firms or management teams.

Leveraged Buyouts (LBOs) Occur When a Firm's Managers, Generally Backed