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When a Public Sector Enterprise (majority share owned by government) is taken over by a private individual or private organization, it is called 'Divestment'. In fact, Private Companies do not 'buy out' public sector companies. They can do so only if a government decides to 'divest' its stake and raise some funds out of it. Generally, governments decide to divest if: a) It cannot run a business successfully, b) It needs to generate funds for other social causes.

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