Buyouts and Leveraged Transactions

For a privately-held business, a sale of the firm to senior management and/or a private equity group is often preferred to a sale to a strategic buyer because it allows for the continuity of the business in a substantially unaltered form, while simultaneously providing liquidity for the current shareholders.

Called management buyouts (MBO’s) or leveraged buyouts (LBO’s), these transactions usually involve substantial amounts of debt financing.  The process can be more complicated than a "straight-up" acquisition due to the participation of multiple parties.  The principals and their attorneys, private equity groups, commercial lenders, and various third-party consultants all have their own priorities, and the coordination of all participants is essential to a timely and successful closing.

Grace Matthews consults with a business owner so that our client understands the terms, terminology, and outcomes of an MBO or LBO, and helps to guide our clients through this process and protect value.