Acquisition
Financial Dictionary — Corporate Finance
Definition
is one company taking over controlling interest in another company. See also MERGER and POOLING OF INTERESTS.
Detailed Explanation
An acquisition occurs when one company obtains control over another, typically by purchasing a controlling stake or assets. Accounting treatment may involve purchase price allocation and goodwill.
Common Uses
- Used in treasury and financial management for funding, investment, and risk decisions.
- Used to evaluate cash flows, financing costs, and capital structure.
- Used to evaluate cash flows, financing costs, and capital structure.
Practical Example
- Example: Finance teams use **Acquisition** when planning funding needs and managing cash and risk.
Why This Term Matters
- Why it matters: Supports liquidity and risk control and improves the quality of financing and investment decisions.