An accretive acquisition is an acquisition that is expected to increase the earnings per share (EPS) of the acquiring company. The increase in EPS is typically achieved by adding the acquired company’s earnings to the acquiring company’s earnings, and then dividing by the number of shares outstanding. The resulting EPS is usually greater than the … Read more
Staple financing is a type of financing that is typically used in mergers and acquisitions (M&A) transactions. In a staple financing, the buyer arranges for the financing of the purchase price of the target company and provides this financing to the seller as part of the purchase price. The seller then uses the proceeds of … Read more
A club deal is an agreement between a group of investors to pool their resources in order to finance a large transaction, such as a merger or acquisition. Club deals are typically used for large transactions that would be too costly for any one investor to finance on their own. Club deals are often used … Read more
A virtual data room, also known as a VDR, is a secure online repository for storing and sharing sensitive documents. VDRs are commonly used during mergers and acquisitions (M&A) transactions, where both sides need to exchange due diligence information. VDRs can also be used for other purposes, such as initial public offerings (IPOs) and real … Read more
An acquirer is a company that completes a merger or acquisition with another company. The term can also refer to the person or group of people who initiate the transaction. In a merger or acquisition, the acquirer is the company that is buying or taking over another company. The target company is the company that … Read more
Subsidiary Company: What It Is, How It Works, and Examples What happens to subsidiaries in a merger? In a merger, the subsidiary companies are combined into one company. The new company is typically a holding company that owns the assets of the subsidiary companies. The subsidiary companies are dissolved and their assets are transferred to … Read more
In play definition refers to the legal definition of what constitutes an act or instance of playing a game. This includes, but is not limited to, the actual physical act of playing the game, as well as the rules and regulations that govern the game. What is merger with example? A merger is a business … Read more
When a company is acquired, the acquiring company often agrees to pay the target company a breakup fee if the deal falls through. The fee is intended to compensate the target company for the time and resources spent on the deal, as well as the opportunity cost of not pursuing other deals. The size of … Read more
Definition and Examples. A wholly-owned subsidiary is a company that is completely owned and controlled by another company, known as the parent company. The parent company may own all or just a majority of the subsidiary’s shares. The subsidiary is a separate legal entity from the parent company, but the parent company has the power … Read more
A congeneric merger is a business combination in which the two companies involved have similar products or services. This type of merger can be used to expand market share, product offerings, or geographical reach. Congeneric mergers are typically less risky than mergers between companies in different industries, since the companies involved have a better understanding … Read more
