
Finance
3 min
Leveraged Buyout: Definition, Mechanics, and Strategic Context
A leveraged buyout (LBO) uses a high proportion of debt to finance the acquisition of a company.
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A leveraged buyout (LBO) uses a high proportion of debt to finance the acquisition of a company.

The acquisition of Electronic Arts was completed on August 4, 2026, for US$55 billion.
The acquisition was announced on January 18, 2022, and completed on October 13, 2023.

A merger involves the combination of two entities into one, whereas an acquisition involves one entity purchasing the assets or equity of another.