buyout
Definition
Noun: 1. The acquisition of a company by purchasing a controlling percentage of its stock: A buyout is a financial transaction where a person, group of investors, or another company gains control of a target company by buying enough of its shares (stock) to own it.
Usage
A buyout typically involves purchasing enough shares to have a controlling interest, which allows the new owner to make major decisions. It is a common strategy in business and finance. - The management team organized a buyout to take the company private. - The private equity firm completed its buyout of the struggling retailer.
Advanced Usage
- Leveraged buyout (LBO): A specific type of buyout where the acquisition is financed largely through debt, which is secured by the assets of the company being acquired.
- The famous leveraged buyout of the 1980s left the company with massive debt.
- Management buyout (MBO): A buyout where the company's existing executives purchase a controlling stake.
- The founder retired after agreeing to a management buyout by her senior team.
Variants and Related Words
- Buy out (phrasal verb): The action of acquiring control of a company by buying shares.
- The investor sought to buy out the other shareholders.
- Buyer (noun): A person or entity making a purchase.
- Acquisition (noun): A more general term for gaining control of a company, which can include methods other than a stock purchase.
Synonyms
- Takeover: The act of gaining control of a company. (Note: A takeover can be hostile, while a buyout is often negotiated.)
- Acquisition: The act of acquiring or gaining possession.
Related Phrases
- To engineer a buyout: To plan and execute a buyout.
- The CEO worked with bankers to engineer a buyout.
- Buyout offer: A formal proposal to purchase a controlling interest.
- The board is considering the latest buyout offer from a competitor.
Noun
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acquisition of a company by purchasing a controlling percentage of its stock
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