Bryan Burrough

Barbarians at the Gate

1. IDEA 1

   A takeover became a frenzy

   Burrough and Helyar tell the story of the 1988 battle to buy RJR Nabisco, a huge food and tobacco company. It became the largest leveraged buyout of its time and a symbol of Wall Street excess.

2. IDEA 2

   A chief executive started it

   Ross Johnson, RJR Nabisco's chief executive, proposed buying the company with borrowed money. His move triggered a bidding war. In the authors' account, this was a bold plan that surprised many people, since the company was well known and already large.

3. IDEA 3

   Leveraged buyouts use debt

   The authors explain leveraged buyouts, where buyers use large amounts of borrowed money to purchase a company. The debt is repaid from the company's earnings. This means the buyer uses little of its own money, and the risk is that the company must earn enough to pay the debt.

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