Greenspan: Pace of LBOs May Be Reaching Peak
HOT SPRINGS, Va.. May 13ÛÓ Federal Reserve Board Chairman . Alan Greenspan told business lead-,en that be believed leveraged buyouts may: be peaking, according to executive* who attended a meeting . of the Business Council here today. -< Û÷He generally talked about what is : happening in the recapitalization of ' Industry,* said William L. Weiss,</br></br>HOT SPRINGS, Va.. May 13ÛÓ Federal Reserve Board Chairman . Alan Greenspan told business lead-,en that be believed leveraged buyouts may: be peaking, according to executive* who attended a meeting . of the Business Council here today. -< Û÷He generally talked about what is : happening in the recapitalization of ' Industry,* said William L. Weiss, (ÐÊ Many executives who heard : GreenspanÛªs speech said they hoped he waa right, but said they believed .'that leveraged buyouts (LBOs) ÛÏThere are tremendous amounts of cash out there to keep this LBO ... situation going for some period of time,Û said David M. Roderick, chairman and chief executive of USX Corp. "Hopefully, Alan is right. But I think that when you look back you see that money markets do not tend to act that rationally.Û</br></br>Robert Kirby, chairman of Capital Guardian Trust Co., which manages pension funds, also expressed doubts about Greenspan's observation, saying that though the easiest, most obvious deals have been done, there still were undervalued companies that are tempting takeover targets.</br></br>Roderick and Kirby were part of a panel discussion on the impact of increasing levels of corporate debt on the economy. The discussion followed a speech Greenspan gave to the Business Council.</br></br>Greenspan's speech, which dealt with the broader issue of worldwide corporate downsizing, was dosed to the press, as are all the business sessions of the Business Council during the two-day, semiannual meeting.