What is a White Squire? A white squire is an individual or company that buys a large enough stake in the target company to prevent that company from being taken over by a black knight. In other words, a white squire purchases enough shares in a target company to prevent a hostile takeover. Learn more…
What is a Public Information Book (PIB)? A Public Information Book (PIB) is a document that compiles available public information on a specific company. Generally, it contains information from the company’s latest annual report, equity research reports, industry information, news articles, and recent quarterly earnings webcasts or conference calls. A PIB is very helpful when performing…
What are the Types of Due Diligence? One of the most important and lengthy processes in an M&A deal is Due Diligence. The process of due diligence is something that the buyer conducts to confirm the accuracy of the seller’s claims. A potential M&A deal involves several types of due diligence. Types of Due Diligence…
What is Acquisition Finance? Acquisition finance refers to the different sources of capital that are used to fund a merger or acquisition. This is usually a complex mission requiring thorough planning, since acquisition finance structures often require a lot of variations and combinations, unlike most other purchases. Moreover, acquisition financing is seldom procured from one source….
What is an M&A Deal Structure? An M&A deal structure is a binding agreement between parties in a merger or acquisition (M&A) that outlines the rights and obligations of both parties. It states what each party of the merger or acquisition is entitled to and what each is obliged to do under the agreement. Simply…
What is a Golden Parachute? A golden parachute, in mergers and acquisitions (M&A), refers to a large financial compensation or substantial benefits guaranteed to company executives upon termination following a merger or takeover. Benefits include severance pay, cash bonuses, and stock options. History of Golden Parachute The term “golden parachute” was first used in 1961….
What is a Hostile Takeover? In mergers and acquisitions (M&A), a hostile takeover is the acquisition of a target company by an acquiring company that goes directly to the target company’s shareholders, either by making a tender offer or through a proxy vote. Basically, a hostile takeover bid is the attempted acquisition of a target…
What Is an Acquisition in Business? An acquisition is a corporate transaction where one company purchases part or all of another company’s shares or assets. Business acquisitions are typically pursued to gain control of the target company, leverage its strengths, and capture strategic synergies. There are several types of business combinations: Acquisition: Both companies continue…
Overview of the M&A Process The mergers and acquisitions (M&A) process has many steps and can often take anywhere from 6 months to several years to complete. In this guide, we’ll outline the acquisition process from start to finish, describe the various types of acquisitions (strategic vs. financial buys), discuss the importance of synergies (hard…
What is a Success Fee? In finance, a success fee is a commission paid to an advisor (typically an investment bank) for successfully completing a transaction. The fee is contingent on successfully helping the client achieve their goal, and thus aligns the interests of the client and the advisor. In a merger and acquisition process, a success…
