Step Acquisition

Brief Definition

Step acquisition, also known as a step-up acquisition, occurs when an entity gradually acquires a controlling interest in another company through multiple purchases over time. Each purchase increases the acquiring company’s ownership stake until it eventually gains control.

Further Explanation

Step acquisition, also known as a step-up acquisition, occurs when an entity gradually acquires a controlling interest in another company through multiple purchases over time. This approach allows the acquiring company to spread out the financial commitment and potentially mitigate risks associated with the acquisition. Each purchase increases the acquiring company’s ownership stake until it eventually gains control.

Example:
Step acquisition, also known as a step-up acquisition, occurs when an entity gradually acquires a controlling interest in another company through multiple purchases over time. This approach allows the acquiring company to spread out the financial commitment and potentially mitigate risks associated with the acquisition. Each purchase increases the acquiring company’s ownership stake until it eventually gains control.