Financial Buyers defined: Financial buyers are acquirers of companies who are primarily investment pools such as a private equity firm or private equity fund. Financial buyers are the opposite of “strategic buyers”, who are in a similar business as the company being acquires and who are doing so for strategic reasons (see PrivCo.com definition of Strategic Buyers. Financial buyers hope to profit primarily by rearranging the financial and capital structure of the acquired company (such as by taking on debt and leveraging their investment, cutting costs, and as soon as possible re-selling the company for a profit). A strategic buyer will typically incorporate the acquired company into its business operations and hold on to it for the long term, if not indefinitely.
Above is a definition for “Financial Buyers” from PrivCo’s Private Company Knowledge Bank, the definitive online and e-book guide to private companies and private company deals.
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