The 1980s LBO Boom

The 1980s leveraged buyout (LBO) boom was a period when private equity firms bought large companies using borrowed money, often covering most of the purchase price with debt. These firms aimed to improve the companies’ performance and sell them at a profit. This approach became popular due to low-interest rates and deregulation, leading to high-profile acquisitions and significant changes in corporate governance. While some companies thrived, others struggled under heavy debt, ultimately influencing the business landscape and leading to discussions about the long-term impacts of such aggressive financial strategies.