[lees-bak] 
| the disposal of a building, land, or other property to a buyer under special arrangements for simultaneously leasing it on a long-term basis to the original seller, usually with an option to renew the lease. |
| lease·back (lēs'bāk') n. A business arrangement whereby property is simultaneously sold and leased back to the seller for usually long-term continued use. Also called sale and leaseback, sale-leaseback. |
Leaseback
An arrangement where the seller of an asset leases back the same asset from the purchaser.
Investopedia Commentary
The lease arrangement is made immediately after the sale of the asset with the amount of the payments and the time period specified. Essentially, the seller of the asset becomes the lessee and the purchaser becomes the lessor in this arrangement.
A leaseback arrangement is useful when companies need to untie the cash invested in an asset for other investments, but the asset is still needed in order to operate. Leaseback deals can also provide the seller with additional tax deductions. The lessor benefits in that they will receive stable payments for a specified period of time.
Also known as a "sale and leaseback."
Related Links
Pros And Cons of Leasing Vs Buying A Vehicle
See also: Lease, Lessee, Lessor, Leveraged Lease, Synthetic Lease
