Matching capital to opportunity

Glossary

A

Acquisition - The acquiring of one corporate entity by another through the exchange of funds or securities.

Alternatives - A form of debt relief referred to in contemporary times as debt restructuring or forbearance.

Asset - A property or resource that holds financial value and is owned or controlled by an individual, corporation or country.

B

Bootstrap Transaction - An alternative term for Leveraged buy-out.

C

Capital structure - The description and relationship of how a corporation’s financing sources are structured.

Collateral - Assets or properties with monetary value that are offered as security in exchange for funds when raising debt finance.

Consolidation - The merger of several smaller corporate entities into one larger organization.

D

Debt Financing - Financing that is secured against bonds, bills or notes, promising the repayment of the principal with interest back to the creditor.

Debt Restructuring - The process of altering the terms of a debt agreement in order to achieve a financial advantage.

E

Expansion - Using capital and financial resources to expand and grow a corporation either in volume, product offerings or expanded territory.

Equity - A form of capital that represents the value of an ownership stake or interest in a property, corporation or asset.

Equity Financing - Financing that is raised in exchange for ownership interest in the corporation.

F

Finance - Describes the process by which assets, investments, debts, capital, money and banking are organized and managed.

Forbearance - The postponement of obligated payments on a financial debt in order to allow the debtor a period of time to make-up for outstanding payments.

H

HLT - An acronym for highly-leveraged transaction (HLT) which is an alternative term for leveraged buy-out.

L

Leveraged Buy-Out (LBO) - When a corporation is purchased through highly leveraged financing by way of borrowing against assets to raise the necessary purchasing funds.

M

Merger - The consolidation of two corporate entities through the exchange or transfer of securities.

Mezzanine Debt - A form of hybrid capital that is senior only to common shares and may incorporate certain characteristics of both debt-based and equity-based financing.

R

Recapitalization - The re-organization of a corporation’s capital structure.

S

Senior Debt - The first level of a corporation’s liabilities which is paid out first ahead of all other creditors.

W

WACC - An acronym for “Weighted Average Cost of Capital” which describes the average amount a corporation must pay out to its security holders in the form of interest.

Working Capital (WC) - A financial metric that determines a corporation’s operating liquidity which is calculated by subtracting a corporation’s current liabilities from its current assets.

Contact Us For Assistance

Contact us for financial assistance

Feel free to contact us to learn more about how capital structure can benefit your business, as well as the various sources of capital and how each can be used.

Contact Us

North American Stock Market

DOW 21,837.62
-62.27 (-0.28%)
S&P 2,446.36
-6.15 (-0.25%)
NASDAQ 6,283.39
-14.09 (-0.22%)