Mergers and acquisitions (M&A) play an essential role in the development and forward momentum of large corporations. In their simplest form, mergers and acquisitions signify a fundamental restructuring or combination of two or more businesses. Companies considering this type of transaction must carefully review many details when deciding on the nature of such a deal. The following list defines a few basic terms common in the vocabulary of M&A.
1. Carve-out: This is a small piece of a company sold as an IPO (initial public offering).
2. Accretion and Dilution: Accretion signifies a growth in earnings based on an acquisition, whereas dilution indicates an earnings decrease.
3. Conglomeration: This defines the joining of two or more companies with no overlap in business type.
An expert in M&A, Jeff Quade has consulted on numerous deals for corporations such as Cisco, General Electric, and HealthTronics.