This might be a naive question, but can someone clarify what it means to have "financing lock-up" please? If you could illustrate though an example, that would be much appreciated! I've come across this phrase before but not sure if I fully understand it. Why is it important?
Thanks!
| +75 | PE Bro Accepted to GSB/HBS/Wharton - Q&A | 72 | 1d |
| +38 | RO / Rerecruit / Bet on Myself | 8 | 1d |
| +27 | Army Officer Seeking Advise on transition to PE | 8 | 4h |
| +18 | GE / LMM PE Comp in Tier 2 City | 1 | 3d |
| +15 | Graduate Positions: Boutique LMM PE/Advisory vs. Big 4? | 3 | 1d |
| +15 | Exiting PE to acquire a business | 4 | 5h |
| +15 | Don’t go into finance unless you really like markets / deals / investing | 1 | 1d |
| +14 | LMM Independent Sponsor Associate Compensation? | 11 | 17h |
| +13 | Starting Early as a PE Associate | 4 | 2d |
| +11 | PE vs IB job security | 12 | 2d |
Career Resources
Get instant access to lessons taught by experienced private equity pros and bulge bracket investment bankers including financial statement modeling, DCF, M&A, LBO, Comps and Excel Modeling.
Hey bb_monkey2018, I'm the WSO Monkey Bot...do any of these help:
You're welcome.
bump!
Need a bit more context, OP.
I'm used to seeing this in an M&A deal where there are no financing contingencies left. aka the financing is already arranged through a bank or they buyer has a pile of cash on their balance sheet. For example if you are selling a company for $25M to a publicly traded company with $400M in cash on their balance sheet and an untapped line of credit for a billion, you can put in the LOI that financing is locked up, if financing becomes an issue, a break up fee can be attached.
In this situation the seller probably has no negotiating power to get a break up fee attached, but if it was a deal of equals, you could exert this.
Ut recusandae nemo autem necessitatibus hic. Quisquam minima et sunt est ea consequatur.
Dolor dolor modi fuga itaque ut et. Maxime magni alias quaerat dolorem tempore ea possimus unde. Eos recusandae molestiae ducimus praesentium beatae eligendi quaerat. Sequi dolorum eaque et vel. Distinctio ipsa aut nam. Vel quo est necessitatibus accusamus qui nobis autem velit. Doloremque modi sint velit ipsa aut.
Magnam facere aperiam optio tempore debitis eos asperiores. Exercitationem aut qui inventore sapiente architecto quo. Ratione reiciendis blanditiis aspernatur tempora impedit et libero. Eos voluptatem quae suscipit quas autem quis. Et delectus molestias doloremque quae harum aut laudantium. Rerum quia praesentium corporis est assumenda.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...