LBO Principle And Application In China

Abstract:Firstly by analyzed the basic principle of leveraged buy—out (LBO), obtained the target enterprise merger party choice strategy by using AHP. Discussed the pricing strategy of M & A both sides based on the asymmetric information. After successful selectly target enterprise, the financing problem is M&A party's key to the successful implementation. This paper mainly used signal asymmetric game, analyzed LBO unique financing process by establishing a mathematical model. And based on this theory, analyzed financing gambling process thoroughly, obtained the equilibrium solution of both M&A and investment bank in the Leveraged buy-out, it provides useful reference for the LBO(leveraged buy-out) decision analysis. Finally, based on China's current situation, analyzed the positive significance and existing problems of current LBO objectively, proposed the development trend and suggestions of LBO in the development of the enterprise.