Dodging bullets : changing U.S. corporate capital structure in the 1980s and 1990s
Author(s)
Bibliographic Information
Dodging bullets : changing U.S. corporate capital structure in the 1980s and 1990s
MIT Press, c1999
- : hc
Available at 33 libraries
-
Prefectural University of Hiroshima Library and Academic Information Center
: hc335.4/Ma13110073813,
335.4||MA131033483
Note
Includes bibliographical references and index
Description and Table of Contents
Description
An entertaining summary of the broad reshaping of U.S. corporate finance in the last decade and a half.
The late 1980s saw a huge wave of corporate leveraging. The U.S. financial landscape was dominated by a series of high-stakes leveraged buyouts as firms replaced their equity with new fixed debt obligations. Cash-financed acquisitions and defensive share repurchases also decapitalized corporations. This trend culminated in the sensational debt-financed bidding for RJR-Nabisco, the largest leveraged buyout of all time, before dramatically reversing itself in the early 1990s with a rapid return to equity.This entertaining summary of the broad reshaping of U.S. corporate finance in the last decade and a half looks at three major issues: why corporations leveraged up in the first place, why and how the leverage wave came to an end, and what policy lessons are to be drawn.Using the Minsky-Kindleberger model as a framework, the authors interpret the rise and fall of leveraging as a financial market mania. In the course of chronicling the return to equity in the 1990s, they address a number of important corporate finance questions: How important was the return to equity in relieving corporations' debt burdens? How did the return to equity affect the ability of young high-tech firms to finance themselves without selling out to foreign firms?
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