Asset Stripper

Asset stripper

A corporate raider (company A) that takes over a target company (company B) in order to sell large assets of company B to repay debt. Company A calculates that the net, selling off the assets and paying off the debt, will leave the raider with assets that are worth more than what it paid for company B.

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Asset Stripper

A corporate raider that acquires a target company and then sells some of its assets, usually to repay its (the corporate raider's) debt. Often, this debt is the debt incurred in the process of taking over the target company. The idea behind asset stripping is that the corporate raider believes that selling some of the assets will both repay the debt and leave the raider with enough extra assets to increase its net worth. In the process of deciding which companies to acquire, asset strippers look for companies worth more as individual assets than as companies.