[santiagogo]

Well, to be fair, leveraged buyouts can be a useful tool to take over a company when there is a bad management team or an opportunity to generate a synergy when it is bought by another player in the same segment. For example this was recently the case with Dell and Hilton.

But generally the high amount of leverage implies aggressive cost cutting, which negatively impacts the employees and in some cases R&D, which in turn means risking the future sustainability of the company for short term profits.

If you're interested in the topic, "Barbarians at the Gate" is a great book to understand the in and outs of LBO's. The writing style also makes it fun to read.