Management buy-outs, which were developed in the United states of America and were later established in the European environment, consist of various legal institutes and financial operations. Under Slovenian legal regime, MBOs are not fully regulated precisely because of its complexity. When analysing MBOs, it is therefore necessary to examine each institute in the buying-out process separately. High-profile cases had significant role during the development of the individual institute of MBO in Slovenia and were the reason for late (and sometimes failed) response of our legislator.
This master thesis firstly examines the term of MBO itself, its historical evolution and the reasons for such buy-outs. The following part of this master thesis shows the MBO by stages, separating the phase of obtaining the funds for buy-out of the company and the phase of repayment of the debt that was obtained for a purpose of the buy-out. Since MBOs create a specific situation in which the management acts as a buyer and a seller, this master thesis further focuses on the issue of the conflict of interest, information asymmetry and related potential misuse of inside information. The final part of this master thesis addresses the issue of the financial assistance of a target company which was highlighted as the main issue of MBOs in Slovenia. Lastly, the issue of protection of creditors is presented from the viewpoint of MBOs, since the creditors of the acquired company can carry the burden of inaccurate and unlawful MBO.
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