Leveraged buyouts are clear examples of ________.
A) strategic mergers
B) vertical mergers
C) financial mergers
D) congeneric mergers

Question

Quizplus · Accepted Answer

Leveraged buyouts (LBOs) are financial mergers, as they involve using significant amounts of debt to finance the acquisition of a company. LBOs are typically executed by private equity firms, which use the acquired company's assets as collateral for the debt they take on to complete the transaction. LBOs are not strategic mergers or vertical mergers, as they do not involve combining complementary businesses or integrating supply chains. LBOs may or may not be congeneric mergers, depending on whether the acquired company is in the same industry as the private equity firm or a different one.

Leveraged Buyouts Are Clear Examples of ________