Back integration is when a company expands its role to perform tasks that were previously performed by enterprises located higher up in the supply chain.
Backward integration often involves buying or merging with another company that supplies its products.
Companies undertake backward integration when it is expected to lead to efficiency gains and cost savings.
Backward integration can be capital intensive, meaning that large sums of money are often required to buy part of the supply chain.
Acquisition premium is the difference between the estimated real value of a company and the actual price paid for its acquisition in an M&A transaction.
Performance Based Management (ABM) is a means of analyzing a company’s profitability by looking at every aspect of its business to determine its strengths and weaknesses.
Share capital is the number of ordinary and preferred shares that the company has the right to issue and which are accounted for on the balance sheet as part of share capital.
As a result of the spin-off, the parent company sells a portion of its shares in its subsidiary to the public through an initial public offering (IPO), effectively turning the subsidiary into a stand-alone company.