Tag: Purchase Price
Chicago Bridge Reversal Reiterates Need for Consistent Accounting in Working Capital True-Up
The vast majority of private company acquisitions contain some type of purchase price adjustment to account for any changes in certain financial metrics (including working capital) of the target between a specified reference date (or target) and the closing date. For a variety of reasons (including the inability to predict […]
$2 Billion Purchase Price Dispute Over GAAP Compliance Highlights Need for Careful Drafting
Purchase price adjustments are common features (2015 SRS study: 77% of deals) of private merger agreements that are generally intended to ensure that the acquired company will have the same level of cash or working capital to operate the business post closing that it had at signing. However, if not […]