Practice Quiz

Consulting Case Interview Practice Questions

Category - Strategy

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True or false: Leveraged buyouts (LBOs) are not collateralized.
  1. True
  2. False
Explanation
Answer: False. In LBOs, the assets of the company being acquired typically serve as collateral, in addition to possible assets of the acquiring company.

Key Takeaway: These are highly risky transactions, and it's rare they would done without collateral.
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