Acquisition finance—key documents and parties
Published by a LexisNexis Banking & Finance expert
Practice notesAcquisition finance—key documents and parties
Published by a LexisNexis Banking & Finance expert
Practice notes
This Practice Note provides a basic introduction to the key parties and documents involved in an acquisition finance transaction together with links for more detailed information.
For an introductory guide to acquisition finance, see Practice Note: Introductory guide to acquisition finance. For a glossary of acquisition finance terms and jargon, see the Glossary of acquisition finance terms and jargon.
Key parties in an acquisition finance transaction
The parties to an acquisition finance transaction will depend on the nature and structure of the transaction and how it is funded. This Practice Note provides information on:
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the buyer, ie the private equity house (sponsor) and special purpose vehicles (SPV) through which it makes the purchase
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seller
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debt providers, and
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the target and its subsidiaries
Purchaser
Sponsor
The sponsor is the private equity firm that provides the equity portion of the funding needed for the purchase.
The sponsor may be captive, ie part of a large institution such as a bank. Alternatively, it can be independent, ie owned and managed by senior officers
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Jurisdiction(s):
United Kingdom
Key definition:
Acquisition finance definition
What does Acquisition finance mean?
A source of external finance obtained by the acquiring company to fund an acquisition. This can be in the form of bank debt and/or equity, such as a share issue.
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