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Billionaire Concepts: Buyouts

by Minority Fortune

Buyouts happen all the time. Large corporations regularly acquire small firms in hopes of adding rising stars to their portfolio. At times, corporations find lucrative companies on their own merits. At other times, they find the deals through firms specializing in reshaping companies and pimping them out. These types of companies are referred to as buyout firms. Some of the richest people in the world have made their money by buying out a mediocre company with potential, revamping it, and then selling it off to big firms once its financials and operations are in order.

Buyout firms prove that one doesn’t have to necessarily start from scratch to strike it big. You can pick up the pieces from companies who have dropped the ball and turn it around. Leading billionaires Carl Icahn, Ronald Perelman, and Gerald J Ford have made a lucrative career doing just that. They stay on the prowl looking for vulnerable companies and attack when the opportunity presents itself.

The Buyout Kings

Carl Icahn and Ronald Perelman are major players in the leveraged buyout world. They each have an estimated net worth of $10 billion to their names. Forbes Magazine reports that Icahn recently bought out a Tropicana Casino & Resort that was in bankruptcy. Prior to that, they each crafted legendary deals with Wal-Mart, Citigroup, Revlon, Marvel Comics, Nabisco, Texaco, and others. They stand as prime examples of people who have profited greatly from the practice of leveraged buyouts.

Gerald Ford kept his buyouts within the niche that he knew the best: banks. He’s a great example of how one can focus on the area that they are the most passionate about. He has amassed his $1.5 billion net worth by buying failing banks at bargain prices. He would fix them up, bundle them together, and sell them off to mega bank corporations. He’s a man known for his patience and only pursues deals when the opportunity presents itself.

What We Can Take Away From It All

You can profit from businesses that you had no part in creating. For example, let’s say you have a passion in publishing. Instead of going through all the pains of starting your own business, you could search for failing firms or firms looking to sell for discounted prices. You could use your talents to improve the business and sell it off to large publishing companies once it’s in its prime.

Success comes in many forms. Those who are most successful think outside the box. There are many paths to greatness. These three individuals found their calling doing things most people know nothing about, and it paid off big time. Buyouts may not be for everyone, but it is another option to add on to your list of possibilities with your passion(s). Knowledge is power when paired with action.

*Images courtesy of Jason Reed/Ryan McVay and Gawker.
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