search query: @indexterm Management buy-outs / total: 202
reference: 38 / 202
| Author: | Kaufman, R. F. Walther, C. H. |
| Title: | Management sponsored LBO's: considerations for valuation ! LBO = leveraged buy-out |
| Journal: | Management International Review
1992 : 3RD QUARTER, VOL. 32:3, p.251-263 |
| Index terms: | MANAGEMENT BUY-OUTS COMPANY OWNERSHIP VALUATION FINANCIAL MODELS DISCOUNT RATE |
| Language: | eng |
| Abstract: | Simultanous solutions to valuation models for the management team, interested in the buyout of a corporate department, and the owners, interested in maximizing the wealth of their stockholders, suggest leveraged buyout (LBO) price modeling flexibility for mutual satisfaction. Using these models the price considerations of both parties are examined using data from a buyout case. It is shown that differences in tax rates and discount rates cause generation of additional shareholder wealth. Wealth allocation between both parties is subject to negotiation. Reliance on additional economies of scope and scale, however, may prove elusive and lead to poor subsequent LBO performance. |
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