The strategy of investors who are attempting a leveraged buyout is to
A) shape up the company for quick resale.
B) use debt to finance the buyout of the firm's stockholders and gain control of the firm themselves.
C) secure ownership of all of the existing stock in a company by issuing and selling large amounts of new stock.
D) use investment tax credits from the government to acquire all of the physical assets owned by the firm.

Question

Quizplus · Accepted Answer

In a leveraged buyout, the objective of the investors is to use debt financing to gain control of the firm's stock for themselves.

The Strategy of Investors Who Are Attempting a Leveraged Buyout