LBO

Post here if you have any strategy tips to share
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mason8821
Posts: 1
Joined: Mon Apr 08, 2013 5:33 am

LBO

Post by mason8821 »

Hello,

I was an avid fan of Capitalism 2 and regularly played it with a focus on total domination. Enlight has made it more difficult, almost impossible to operate a monopoly in this game due to more intelligent/resilient AI, decreased emphasis on property location, ability to buy media firms(I would purchase all media firms and charge maximum rate to discourage competitors from advertising), reappearing mineral sites, usefulness/consumer response to R&D(before I would simply undercut/out-advertise my competitors and still push them out of the market regardless of a product tech level) and other features.

The few times I played Capitalism 2 it was fairly difficulty although once I learned how to monopolize the firm profits greatly increased(although this is discouraged in society, it could be argued a firm's desire and efforts to monopolies markets to reflects real world conditions). Capitalism Lab is much more difficult in this regard and although I plan to reconsider my general business approach, similar to real life you can use leveraged buy outs. I start the game, set up retail stores in cities using seaport products and take a 100 million dollar loan. Then I will begin monitoring the other firms, there are usually 2 firms that greatly profit, one mediocre firm(which may later change), a firm that usually fails and a holding company. A holding company doesn't sale products and doesnt' generate revenue but in the game is presumably backed by private investors. Sometimes this holding company will purchase significant equity position in other companies(5-20 %, sometimes buying a company) and sometimes investing in this company is a cheap way to gain equity.

What I do is I invest in companies with high profits and continue to invest as they grow, I usually take up 30 percent shares in 2 firms. I afforded this despite a minimal emphasis on retailing through bank loans, I think the game determines bank loan primarily based on assets and the equity of a company you hold counts as an asset, so although you may be making 50 million a year in profits, if the shares you own are worth x billion you can get huge loans and will continue to get large loans as long as your asset base grows.

Along with careful selection, diverse exposure(sometimes I will sell shares of profitable investments or solely invest in a company that isn't a merger target), timing and increasing bank loans despite a small profit within a few years using debt I can acquire the most profitable or a highly profitable company leading in retail/manufacturing. I will then acquire this company and go from 50-100 million in profit to 600 million+ and since unlike the prior game A.I. does an excellent job of managing their firms, there is little need to modify the firm's holdings, supply lines, retail strategy, etc. Also another tip to make megers easier is to look at the companies most profitable products and create an ad hoc attack to take the firm's market share and force them to lower prices in order to lower the firm's stock price. Also another tip is once you control the company( over 50 %) you can dilute shares by having the subsidiary issue new shares.

Anyway within a few years I can usually be operating a 1.5-2.5 billion dollar firm solely using LBOs, around this time the A.I. becomes highly defensive and Ceos will seek 100 ownership of their firms, although at this point it's too late :DD.

Anyway I hope you found this guide useful!
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