This plan was intended to unlock shareholder value and simultaneously allow Johnson and his management team to maintain control over the company. The debt is then repaid through the acquired company’s cash flows or asset sales. Johnson’s plan involved a leveraged buyout of the company, a process in which a small group of investors borrows heavily to purchase a controlling interest in a corporation. Ross Johnson, the charismatic and ambitious CEO of RJR Nabisco, who was seeking ways to boost the company’s stock price amid concerns over the future of the tobacco industry. The high-stakes corporate drama unfolded in the late 1980s and is regarded as a symbol of the excesses and greed associated with that era of Wall Street. Reynolds Tobacco Company and Nabisco Brands Inc. The book, published in 1989, chronicles the heated battle for control of RJR Nabisco, a conglomerate formed by the merger of R.J. “Barbarians at the Gate: The Fall of RJR Nabisco” by Bryan Burrough and John Helyar provides a detailed account of one of the most notable and dramatic leveraged buyouts (LBO) in business history.
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