Sorting the lemons from the lies in airfreight booking
When will the money run out?
PITCHBOOK writes:
As private equity deal financing gets harder, sellers are granting favorable deal terms to buyers, such as deferred or performance-based payment, in order to close transactions.
Dealmakers say these structures also help bridge a growing valuation gap created by growing economic uncertainty and a tighter debt market.
“People find ways to get the transactions done,” said Markus Bolsinger, co-head of law firm Dechert‘s PE practice.
One solution has been to include one or multiple provisions known as earnouts that allow buyers to defer a portion of the purchase price and make the remaining payments only when the purchased company meets certain milestones, such as reaching an earnings target, getting a regulatory approval or accomplishing a strategic sale…
To read the full post, please click here.
Also of interest: “Pressure continues to mount on VC“.
Comment on this article