APCRI

A fund that is raised by entrepreneurs to find a business, acquire it and manage it until and exit can be achieved.

A loan is used in leverage buyouts, that is subordinated to a senior loan (first-lien loan), but has a preferential settlement over a mezzanine loan.

A public offering of a security by a selling holder of securities, rather than by the issuer. The term secondary offering is also sometimes used more generally in reference to any public offering other than an IPO.

Compare primary distribution.

An investment where a fund buys either, a portfolio of direct investments of an existing private equity fund or limited partner's positions in these funds.

A market or exchange in which securities are bought and sold following their initial sale. Investors in the primary market, by contrast, purchase shares directly from the issuer.

Loans secured against a company’s assets.

(US) A Federal law regulating the offer and sale of securities by the issuer or its affiliates. It generally requires issuers seeking to raise funds from the public to provide investors with extensive information. Its liability provisions, particularly for incorrect registration statements, create a liability rule of caveat vendor or let the seller beware.

Financing provided to research, assess and develop an initial concept before a business has reached the start-up phase.

See early-stage.

A debt instrument which specifically has a higher priority for repayment than that of general unsecured creditors. Typically used for long-term financing for low-risk companies or for later-stage financing.

Compare subordinated debt.

The classification of funds by order of investment. First in a sequence is the new fund, defined as the first fund a management group raises together, regardless of the experience level of individual professionals in that group. Next are follow-on funds, defined as subsequent funds (II, III, IV, etc) raised by the same management group.

Agreement further to which one or more purchasers buy shares issued by one or more target companies from one or more sellers. The agreement will set out/forth the type and amount of shares sold, the representations and warranties, the indemnification in the event of misrepresentation and may also include post-closing covenants (such as the obligation for the sellers not to compete with the purchasers).

The term shell typically refers to a company that has been duly organised and is currently in existence, but that has no history of operations.

A family office providing services to one family, but several generations of family members.

(US) An investor who is deemed to be sophisticated and sufficiently knowledgeable with respect to financial matters that it can fend for itself in the purchase of securities and does not require the full protection of securities law.

An increase in the number of outstanding shares of a company’s stock, such that proportionate equity of each shareholder remains the same. In theory, the market price per share should drop in proportion. Usually done to make a stock with a very high per-share price more accessible to small investors. Requires approval from the board of directors and sometimes shareholders.

Statutory provisions entitling an offeror who has acquired the support of a certain percentage of shareholders to acquire the balance of shares in the target company.

A pre-arranged financing package that a financial advisor or investment bank offers to the potential buyer in an auction process, when putting up a company for sale.