Strategic buyout


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Strategic buyout

Acquisition of another firm in order to realize some operational benefits which will result in increased earnings.

Strategic Buyout

The purchase of one company by another where the buyer believes that the acquisition will create synergy, which is a financial benefit that the buyer may derive from the acquisition. For example, the buyer may determine that the two companies together may be able to produce more revenue than either one could produce independently by combining the most efficient processes each brings to the merger. Alternatively he may decide that the strategic buyout will reduce expenses by eliminating or streamlining redundant processes. The main point of a strategic buyout is to ensure the acquirer benefits, though the purchased company often benefits as well.
References in periodicals archive ?
Axial Vector Energy Corporation (Avec) said its wholly-owned subsidiary Avec Strategic Acquisitions Corporation will aim for strategic buyouts and help boost the company's revenue.
There will be opportunities for nontech companies as well--especially those looking for strategic buyouts.
With the increase of strategic investments and corporate venturing in the pharmaceuticals and biotechnology segments, mergers and acquisitions and strategic buyouts have become attractive exit options.
Although private equity deals have dominated acquisition activity, CFOs are predicting an increase in strategic buyouts this year.
Cash rich companies actively pursuing strategic buyouts.
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