Why would you use leverage when buying a company?

To increase your returns.

Remember, any debt you use in an LBO is not “your money” – so if you’re paying $5 billion for a company, it’s easier to earn a high return on $2 billion of your own money and $3 billion borrowed from elsewhere vs. $3 billion of your own money and $2 billion of borrowed money.

A secondary benefit is that the firm also has more capital available to purchase other companies because they’ve used leverage.