Transaction Category
Term | Definition |
|---|---|
| Add-on acquisition | Companies acquired as part of a consolidation i... more |
| Break-up fee | Compensation paid to buyer should seller termin... more |
| Buy-in management buyout (BIMBO) | Transaction type where additional/new managemen... more |
| Certainty of closure | Likelihood that a transaction will go through. more |
| Closing | The last event in making an investment in which... more |
| Club deal | An acquisition involving multiple private equit... more |
| Co-investor | Secondary direct investors in a private equity ... more |
| Consideration | Total value of buyer's offer on a business. more |
| Consolidation | Also known as a roll-up, an investment strategy... more |
| Control | Acquiring at least a 50% stake in a company, ei... more |
| Dead deal cost | Resources expended on a potential transaction t... more |
| Divest | To sell a piece of a company. Could be a produ... more |
| Divesting | Selling a non-core or non-strategic business un... more |
| Divestiture | Transaction type that occurs when a non-core bu... more |
| Due diligence | Process where a prospective buyer investigates ... more |
| Earn out | Future payments, often tied to future revenues ... more |
| Exclusivity | Period of time, typically 30 to 60 days, in whi... more |
| Exit | Investment realization. more |
| Financing contingency | Clause in a purchase agreement that protects a ... more |
| Growth capital | Investment used to fund business expansion. more |
| Investment horizon | Period of time, typically three to seven years,... more |
| Leveraged buyout (LBO) | The purchase of a company using debt often secu... more |
| Management buy-in (MBI) | The purchase of a company where outside executi... more |
| Management buyout (MBO) | The purchase of a company where in place senior... more |
| Management presentation | First face-to-face meeting between prospective ... more |
| Merger | Combination of two (or more) businesses with th... more |
| Non-control | Investment situation where other investor(s) ha... more |
| Non-core/Non-strategic | A business segment that no longer complements o... more |
| Platform | A business acquired to serve as an acquisition ... more |
| Privatization | Change in a public company's ownership where sh... more |
| Purchase price adjustment | A change to the purchase price of a business ty... more |
| Site visit | Visiting a prospective company before making an... more |
| Sources and Uses | A listing of funds arranged to complete a trans... more |
| Stalking horse bidder | Friendly buyer that a troubled or distressed co... more |
| Success fee | A bonus paid to a private equity firm to reward... more |
| Under the tent | Having knowledge that a business is quietly for... more |
| Venture debt | Form of investment capital typical for early st... more |