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Mergers & acquisitions
Referring to the aspect of corporate strategy, finance and management that deals with the buying, selling or combining of different companies that can assist a growing company to grow rapidly without having to create another business entity.
Industry: Banking; Business services
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Mergers & acquisitions
vertical merger
Banking; Mergers & acquisitions
One in which companies that do not own operations in each major segment of the value chain choose to backward integrate by acquiring a supplier or to forward integrate by acquiring a distributor.
voluntary bankruptcy
Banking; Mergers & acquisitions
A situation in which the debtor firm files for bankruptcy.
voluntary liquidation
Banking; Mergers & acquisitions
Sale by management that concludes that the sale of the firm in parts could realize greater value than the value created by a continuation of the combined corporation.
weighted-average cost of capital
Banking; Mergers & acquisitions
A broader measure than the cost of equity that represents the return that a firm must earn to induce investors and lenders to buy its stock and bonds.
white knight
Banking; Mergers & acquisitions
A potential acquirer that is viewed more favorably by a target firm’s management and board than the initial bidder.
winner’s curse
Banking; Mergers & acquisitions
The tendency of the auction winners to show remorse, believing that they may have paid too much.
zero-growth valuation model
Banking; Mergers & acquisitions
A valuation model that assumes that free cash flow is constant in perpetuity.