What Is a Leveraged Buyback? A leveraged buyback is a corporate finance transaction that enables a company to repurchase some of its shares using debt—reducing the number of shares outstanding increases the remaining owners’ respective shares. Also known as a leveraged share repurchase, a leveraged buyback has similar impacts as leveraged recapitalizations and dividend recapitalizations
What Is a Leveraged Buyout? A leveraged buyout (LBO) is the acquisition of another company using a significant amount of borrowed money (bonds or loans) to meet the cost of acquisition. The assets of the company being acquired are often used as collateral for the loans, along with the assets of the acquiring company. Key
What Is a Leveraged ETF? A leveraged exchange-traded fund (ETF) is a marketable security that uses financial derivatives and debt to amplify the returns of an underlying index. While a traditional exchange-traded fund typically tracks the securities in its underlying index on a one-to-one basis, a leveraged ETF may aim for a 2:1 or 3:1
What Is a Leveraged Loan? A leveraged loan is a type of loan that is extended to companies or individuals that already have considerable amounts of debt or poor credit history. Lenders consider leveraged loans to carry a higher risk of default, and as a result, a leveraged loan is more costly to the borrower.
What Is a Leverage Ratio? A leverage ratio is any one of several financial measurements that look at how much capital comes in the form of debt (loans) or assesses the ability of a company to meet its financial obligations. The leverage ratio category is important because companies rely on a mixture of equity and
What Is Levered Free Cash Flow (LFCF)? Levered free cash flow (LFCF) is the amount of money a company has left remaining after paying all of its financial obligations. LFCF is the amount of cash a company has after paying debts, while unlevered free cash flow (UFCF) is cash before debt payments are made. Levered
What Is the Lewes Pound? The Lewes pound is a community currency for use by British residents of Lewes, East Sussex. Lewes pounds are accepted only by local businesses, some of which may offer discounts on items purchased using the local currency. Lewes pounds were launched as part of an initiative to inspire consumers to
Lewis “Lew” Ranieri (b. 1947) is a former bond trader and former vice-chair of Salomon Brothers who is credited with popularizing the concept of securitization in the financial world. Ranieri’s securitization revolution allowed all sorts of cash flows from debts (such as credit cards, mortgages, etc.) to be pooled and rolled into bonds. Key Takeaways Lewis Ranieri was
What Is the Libyan Investment Authority (LIA)? The Libyan Investment Authority (LIA) is a government-controlled entity that manages Libya’s sovereign wealth fund (SWF). The LIA’s goal is to achieve investment returns to provide for future generations by investing revenues derived from Libya’s oil reserves. The LIA was established in 2006 and has more than $67
What Is a Liability? A liability is something a person or company owes, usually a sum of money. Liabilities are settled over time through the transfer of economic benefits including money, goods, or services. Recorded on the right side of the balance sheet, liabilities include loans, accounts payable, mortgages, deferred revenues, bonds, warranties, and accrued
