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Chapter 12
5.2 Forms of consideration
Share for share
Cash offer exchange Earn-out
The consideration is
split so that there is an
The bidding company initial amount paid at
Target company issues some new the time of acquisition,
shareholders are shares and then and the balance
offered a fixed cash exchanges them with deferred (and only paid
sum per share. the target company if the target entity
shareholders. achieves specified
performance targets).
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