This article is based upon A Study On Leveraged Buyout’s In India. The project titled “leveraged buyout in India” gives us the brief idea regarding leveraged buyout’s (mergers & acquisitions) and its present scenario in Indian market. This article includes some of the components of the project and you can download the entire project as well.
The project titled “leveraged buyout in India” gives us the brief idea regarding leveraged buyout’s (mergers & acquisitions) and its present scenario in Indian market. The various things that can be known through the study of this report are the history of leveraged buyout, buyout effects, challenges associated with it, governmental policies, and also brief history about Indian banking sector & private-equity firms.
The project provides us basic knowledge regarding Fundamental by studying financial structure and characteristics of companies. Overall, it provides a greater exposure to international finance by studying the financial aspects & terms associated with the study.
The evolution of leveraged buyouts came into existence in 1960’s. During the 1980’s LBO’s became very common and increased substantially in size, LBO’s normally occurred in large companies with more than $100 million in revenues. But many of these deals subsequently failed due to the low quality of debt used, and thus the movement in the 1990’s was toward smaller deals (featuring small to medium sized companies, with about $20 million in annual revenues). The most common leveraged buyout arrangement among small businesses is for management to buy up all the outstanding shares of the company’s stock, using company assets as collateral for a loan to fund the purchase. The loan is later repaid through the company’s future cash flow or the sale of company assets.
A management-led LBO is sometimes referred to as “going private,” because in contrast to “going public”—or selling shares of stock to the public—LBOs involve gathering all the outstanding shares into private hands. Subsequently, once the debt is paid down, the organizers of the buyout may attempt to take the firm public again. Many management-led, small business LBOs also include employees of the company in the purchase, which may help increase productivity and increase employee commitment to the company’s goals.
OBJECTIVE OF THE STUDY
1. To know standards required for a company to go for
Leveraged buyout deal
2. To study post leveraged buyout deal in metal industry
3. To study banking & private equity firms