MANAGEMENT BUY OUT (MBO)
\mˈanɪd͡ʒmənt bˈa͡ɪ ˈa͡ʊt ˌɛmbˌiːˈə͡ʊ], \mˈanɪdʒmənt bˈaɪ ˈaʊt ˌɛmbˌiːˈəʊ], \m_ˈa_n_ɪ_dʒ_m_ə_n_t b_ˈaɪ_ ˈaʊ_t__ ˌɛ_m_b_ˌiː__ˈəʊ]\
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Existing management's purchase of a firm or one of its divisions generally occur when the parent firm wants to divest a subsidiary or the firm or its division is threatened with closure. The purchase is usually done with outside financing. If all employees participate in the purchase it is known as an employee buy out .
By Henry Campbell Black
