Posts Tagged ‘buyout’

Foreign-Currency Debt Hits Hard In Central Europe

Thursday, August 5th, 2010

In Europe’s tight quarters, borrowing from your neighbor across the border could lead you down a bumpy road.

  • Central European households and small businesses are struggling under the weight of foreign-currency debts.
  • The fluctuation in interest rates and currency values associated with foreign-currency lending has put many into debt, resulting in stalled economies as people try to pay off loans.
  • Governments are scrambling to implement preventative regulations, including legislation to ban foreign-currency mortgage loans and a government buyout fund that would allow borrowers to convert their foreign loans to their native currency.

Facts & Figures

  • In Hungary, nearly 70% of the country’s total household debt was borrowed in foreign currency.
  • In the Baltic states 70-90% of household borrowing is in foreign currency.

Best Quote

“Hungary is close to its non-performing loan peak.” – Sandor Csanyi, Chief Executive, OTP

A Buyout is…

Friday, August 21st, 2009

A buyout is when a person or company buys the majority of shares, i.e. a controlling interest, in another company. This means they control the majority of votes at the annual meeting, can impact the board of directors, and influence other company decisions.

A Management Buyout is…

Monday, August 3rd, 2009

A management buyout is a buyout of a firm or a piece of a firm by the firm’s own management. For example, Company A owns Company B, and the management of Company B decides to buy their own company from Company A – that’s when you get a management buyout.

A Leveraged Buyout is…

Sunday, August 2nd, 2009

A leveraged buyout is the purchase of a controlling share of a company by using borrowed money. In other words, a leveraged buyout is when one company takes over another company and instead of paying for it in cash or equity, the purchased is paid for with debt (bonds or borrowed cash).

A Takeover is…

Wednesday, July 15th, 2009

A takeover is generally the act of assuming control of something, but in business it refers to the purchase of one company by another. For example, if Corporation A takes over Corporation B, then Corporation B is now owned and controlled by Corporation A. A takeover can be done by purchasing stock or exchanging stock; it can also be hostile or friendly.