Leverage buyouts may be done for a number of different reasons. Maybe one business wants to expand by purchasing another one. Or perhaps someone from inside the company makes the purchase in order to help out their own people. Whatever the reason for making the acquisition, it usually all ends up the same way. When all is said and done, a company has a new owner and a new future ahead of it. At the same time, different things can happen while the process is in progress. Here are a few different scenarios that you can run into.

One particular scenario is known as the repackaging plan. This is when a private company acquires a public business. Then they privatize that business and spend some time making changes to its model, and re release that company back into the marketplace. Some firms do this with many businesses all at once, since it can be a good way to diversify. Doing things this way is most worth it if you plan to make some big changes to the company that you are buying.

A portfolio plan is often the most beneficial option for all of the parties involved. This entails acquiring a competitor to your business, or one that is similar to your own. It is important to make sure that the returns you can stand to gain from this acquisition are greater than what it costs to make the purchase. Otherwise, the plan may fail completely.

A split up involves dividing the acquired company up into its separate parts. This is usually only done in a scenario where the business is better off as individual pieces rather than a whole. It may be worth less when it is all in one piece, and of course the main pursuit here is to make money. This technique may have a bad image in people’s minds, but it is often done with the good of the company in mind. In leverage buyouts, the main goal is always greater success for the businesses involved.

These are just a few of the main leverage buyouts situations that one can encounter. Being familiar with them will make the process much easier should you encounter them in real life. A buyout may be done for many different reasons, but it is often done in the spirit of making a company better. Depending on your business goals, this might be the right move for your company to make. Research the process first and see if it fits with your needs.