Earnouts Back on the Rise in M&A Transactions: What Purchasers, Sellers and Lenders Need to Know
By EsqSocial Corporation 24/04/24
The pace of earnouts accelerates in M&A transactions whenever market conditions create a value gap between seller price expectations and buyer confidence levels. Earnouts are most common when the volume of merger and acquisition activity falls, whether due to a recession (e.g., the 2008–2010 recession) or other external factors like the current increase in interest rates coupled with tight credit markets. In some cases, earnouts are solutions to the underlying recent performance of the target...
By: Vedder Price