Bankruptcy proceedings and their possible effect on prior leveraged buy-out operations in Spain

In recent years, Spain has witnessed a surge in leveraged buy-outs (LBOs), where a majority share of a target company is acquired using loans guaranteed by its assets or repaid through its cash flows. In some cases, the acquisition cost is deferred and paid by the target company itself, often through a merger with a special purpose vehicle created by the investor. This strategy shifts the burden of the acquisition cost to the target company.

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