Question

40. Nearly all LBOs are set up as:

A. general partnerships

B. private corporations

C. limited partnerships

D. private or quasi-public entities

41. A frequent target of a leveraged buyout (LBO) firm is a(n) :

A. successful firm that is undercapitalized

B. biotech firm

C. conglomerate

D. small firm

42. Structured PIPEs possesses significant risks. Which of the following would typically not be one of these risks?

A. PIPEs structured with “fixed” conversion ratios

B. The large majority of PIPE transactions are not structured

C. PIPEs structured with “floating” conversion ratios

D. PIPE transactions may become “death spirals”

Answer 1

40.Generally all leveraged buyouts are set up as private companies or quasi public corporations. It is minutely connected to public corporations or general partnerships

Correct answer would be option d)private or quasi public entities.

41. Frequent target of a leveraged buyout will always be a firm which is under capitalised and successful so that it can be converted into a good investment and good returns.

Biotech form, conglomerate, small form are not the potential targets for leveraged buyout.

so the correct answer would be option a) successful firm that is undercapitalized