leveraged recapitalization

leveraged recapitalization definition - business

leveraged recapitalization

A corporate reorganization in which borrowed funds are used to pay a large one-time dividend to shareholders. The result is a company with greater financial risk because of increased debt and reduced equity. In some instances the dividend is paid in shares of stock rather than cash to inside shareholders, who increase their proportional ownership and control.

The American Heritage® Dictionary of Business Terms Copyright © 2009 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.

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