What is a Bust-Up Takeover?
A bust-up takeover is a situation in which some or all of the assets associated with a recently acquired company are sold in order to cover the costs that were incurred during the acquisition process. In some cases, the bust-up takeover will focus on a few key assets of the corporation in order to settle the indebtedness, while still maintaining the operations and functionality of the corporation. In other situations, the focus may be on completely dismantling the company, dispensing with all associated expenses, and dividing the profits among the investors who initiated the takeover. When a leveraged buyout is the means of orchestrating a friendly takeover of a company, the investors usually do so with an eye to restructuring the corporation and continuing operations. If this is the goal, the group of investors will often focus their attention on target companies that have a number of assets that are not central to the core business model of the corporation. As part of the restructure
