The Acquisition of a business utilizing equity or investment capital and third-party debt financing. The assets of the company being acquired are often used as collateral for the loans, along with the assets of the acquiring company. The purpose of leveraged buyouts is to allow companies to make large acquisitions… Read More »Leveraged Buyout (LBO)
An accounting method of valuing inventory, based on the assumption that the “last”, most recent, unit of an item of inventory purchased is the first unit sold out of inventory. In pricing the inventory under this valuation method the ending inventory is the aggregate of the cost of the oldest… Read More »LIFO (Last In First Out)
The act or process of determining the value of a business, business ownership interest, security or intangible asset with limitations in analyses, procedures or scope.
The net amount that would be realized if the business is terminated and the assets are sold piecemeal. Liquidation can be either “orderly” or “forced.”
The ability to quickly convert property to cash or pay a liability. Liquidity describes the degree to which an asset or security can be quickly bought or sold in the market at a price reflecting its intrinsic value.
Addresses a change made to the original listing. Also called a Listing Addendum.
Occurs when the buyer assumes all of the rights and obligations of a debt currently in the name of the seller.
The debt due to be paid at a date more than one year in the future. Also, the loans and obligations with a maturity of longer than one year; usually accompanied by interest payments. From a business owner’s perspective Long Term Debt Financing usually applies to assets the business is… Read More »Long-term Debt
The lower end of the middle market segment of the economy, as measured in terms of annual revenue of the firms. Firms with an annual revenue in the range of $5 million to $50 million are grouped under the lower middle market category.
The degree of Control provided by a majority position.