Capital infusion

Capital infusion

Often refers to the cross-subsidization of divisions within a firm. When one division is not doing well, it might benefit from an infusion of new funds from the more successful divisions. In the context of venture capital, it can also refer to funds received from a venture capitalist to either get the firm started or to save it from failing due to lack of cash.

Capital Infusion

1. Within a firm, the provision of funds to a relatively unsuccessful division from the profits of another division. Management may infuse a division with capital if it believes that it will eventually become profitable.

2. Funds received from a venture capital firm. Capital infusion may help a start-up survive the first few months or years before it becomes profitable, or it may help a failing business maintain its operations as it restructures or reforms.
References in periodicals archive ?
Global Banking News-January 31, 2018--Federal Bank's NBFC arm to get capital infusion
Summary: New Delhi [India], Jan 24 (ANI): Welcoming the Rs 4,694 crore-worth capital infusion from the government, the Indian Overseas Bank (IOB) on Wednesday said the designated amount will facilitate the bank to meet its regulatory requirements.
Moody's also cited Security Bank's 'strong capital buffers,' in turn boosted by the recent capital infusion from its new strategic partner, The Bank of Tokyo Mitsubishi-UFJ (BTMU).
The UCO Bank Board, during its meeting on Monday, has made through assessment on the banks proposal to issue equity shares to the Union Government on preferential basis for the proposed capital infusion and then offered its nod for the plan.
Canara HSBC OBC Life Insurance, a joint-venture life-insurance company operating in India, is to get a capital infusion.
The rating upgrade reflects a significant improvement in the company's capitalisation following fresh equity capital infusion of INR1.
MAX New York Life is planning a capital infusion of around Rs 200 crore by March this year to fund the leading private insurer's growth plans.
economic outlook eased due to a capital infusion into Merrill Lynch & Co.
We decided to bring in some additional investors and capital and, as a result of this capital infusion, we will no longer be a minority-owned business," says Westbrook, the company's chairman and chief strategic officer.
The capital infusion will be used to expand tissue production and refinance the company's existing credit facilities.
The attractive interest rate environment, strong sponsorship, and recent capital infusion for development in downtown Hartford were key elements in bringing Talcott II Gold and Allstate to the table," said Yates.
Swedish financial group Skandia Insurance Company said on Friday (27 September) that it would make a capital infusion of USD255m to its US subsidiary American Skandia Life Assurance Corporation.

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