Funds galore for LBO prospects | Tax snags of a global buyout | Europe is the next frontier | Some examples of recent MBOs | Managers who succeed as bosses | Spawn of an era: specialist firms | Warnings fail to dim LBO dazzle
Management buyouts have become a major part of the UK business and commercial scene. In 1985, there were 245 buyouts involving total finance of about 1.2 billion; as of late October this year, about 166 deals had been identified totalling roughly 1 billion. These figures represent a remarkable increase from the modest numbers and sums involved as recently as 1980, when buyouts emerged as a significant phenomenon in the UK.
Buyouts have grown in complexity as well as numbers. The marketplace is now a sophisticated and mature sector which has implications for corporate strategy, corporate control and the structure of company finance.
Although it is still in embryonic form, there is evidence that UK expertise is spreading to Europe with the growth of buyout business in France, the Low Countries and West Germany. This development in continental Europe is likely to include the kind of transactional buyouts that are already taking place between the UK and the US and Canada, in which buyouts involve a company's operating units in several countries.