The M&A world has a lot of abbreviations, all of which the advisors working in this field like to use. To not get overwhelmed by these terms or be confused what your investor or advisor is talking about on this page you will find the most common used abbreviations. If any is missing, be sure to let it know in the comments below!
| ABBREVIATION | DEFINITION |
|---|---|
| APA | Asset purchase agreement |
| BP | Business plan |
| BS | Balance sheet |
| BU | Business unit |
| CAGR | Compound annual growth rate |
| CAPEX | Capital expenditures |
| CCC | Cash conversion cycle |
| CDD | Commercial due diligence |
| CF | Cash flow |
| CGT | Capital gains tax |
| CIM | Confidential information memorandum |
| CIT | Corporate income tax |
| COC | Change of control |
| COGS | Cost of goods sold |
| COS | Cost of sales |
| D&A | Depreciation & amortization |
| DCF | Discounted cash flow |
| DD | Due diligence |
| DIO | Days inventory outstanding |
| DPO | Days payable outstanding |
| DSO | Days receivable outstanding |
| DTA | Deferred tax asset |
| DTL | Deferred tax liability |
| EBIT | Earnings before interest and taxes |
| EBITDA | Earnings before interest, taxes, depreciation and amortization |
| ERP | Enterprise resource planning |
| EV | Enterprise value |
| FC | Forecast |
| FCF | Free cash flow |
| FDD | Financial due diligence |
| FS | Financial statements |
| FTE | Full time equivalent |
| FY | Fiscal year |
| GAAP | Generally accepted accounting principles |
| HOA | Heads of agreement |
| HR | Human resource |
| IC | Investment committee or intercompany |
| IFRS | International Financial Reporting Standards |
| IM | Information memorandum |
| IOI | Indication of interest |
| IPO | Initial public offering |
| IRS | Internal revenue service |
| JV | Joint-Venture |
| KPI | Key performance indicator |
| LB | Locked box |
| LBO | Leveraged buy out |
| LFL | Like-for-like |
| LOI | Letter of intent |
| LTM | Last twelve months |
| MA | Management accounts |
| M&A | Mergers & Acquisitions |
| MAC | Material adverse change |
| MAE | Material adverse event (or effect) |
| MBI | Management buy in |
| MBO | Management buy out |
| MOU | Memorandum of understanding |
| MP | Management presentation |
| MRR | Monthly recurring revenues |
| MT | Management team |
| NAV | Net asset value |
| NBO | Non-binding offer |
| NDA | Non-disclosure agreement |
| NOPLAT | Net operating profit less adjusted taxes |
| NWC | Net working capital |
| OPEX | Operating expenses |
| PBT | Profit before taxes |
| PE | Private equity or Price-to-earnings |
| PF | Pro forma |
| PL | Profit- and loss account |
| PMI | Post-merger integration |
| PSA | Purchase and sale agreement |
| Q&A | Questions & Answers |
| R&D | Research & Development |
| R&M | Repair & Maintenance |
| RR | Run-rate or recurring revenues |
| SLA | Service level agreement |
| SPA | Share purchase agreement |
| SWOT | Strengths, weaknesses, opportunities and threats |
| TDD | Tax due diligence or Technical due diligence |
| TS | Term sheet |
| TSA | Transitional service agreement |
| TTM | Trailing twelve months |
| TWC | Trade working capital |
| USP | Unique selling point |
| VAT | Value added tax |
| VC | Venture capital |
| VDD | Vendor due diligence |
| VDR | Virtual data room |
| WACC | Weighted average cost of capital |
| WC | Working capital |
| YTD | Year-to-date |
| YTG | Year-to-go |