YEAR 2015 N.º 2

ISSN 2182-9845

The Financial Assistance Prohibition. Especially the Leveraged Buyout (LBO)

Pedro Nunes


Financial assistance; leveraged buyout; takeover; mergers & acquisitions; share deals


The prohibition of financial assistance, forged at the dawn of the twentieth century, has suffered throughout the European area, a trend of easing. This trend came to be consecrated in 2006 by the Community legislature. However, in Portugal remains the absolute prohibition of financial assistance. At first we analyse thus the relevance of this regime today. Secondly we examine the case of LBO. Operations that use this companies’ acquisition technique reveal an economic relevance that should not be ignored. However, the doctrine has not observed, with due attention, the LBO. We propose to explain in short term, the main aspects of how to assemble the operation. Finally we treat the question of whether this is a valid operation in the light of Portuguese law.