Strategic vs Financial Buyer
The two structurally distinct buyer types in M&A. STRATEGIC buyers are operating companies that pay for synergies (cost reductions, revenue cross-sell) on top of the standalone business value. FINANCIAL buyers are private-equity sponsors that price standalone cash flow and constrain leverage to debt-market capacity. Strategic buyers typically pay 2-4 turns of EBITDA more than financial buyers for the same target, which is why precedent sets should be bucketed by buyer type before computing a median.
Lessons that use this term
Related terms
Ambiguity Aversion · Anchored Assumption · Asset Beta · Bank ROE Spread · Banker Pitch Deck · Beta
Open this term in the app → — no account needed; browse the full glossary while you research.