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This is probably a dumb question, but what does all cash mean? Does it literally mean that they are putting $32bn in Wiz's bank account (or probably some kind o
by atonse 2y ago
This is probably a dumb question, but what does all cash mean? Does it literally mean that they are putting $32bn in Wiz's bank account (or probably some kind of escrow, who knows) which then gets dispersed to their shareholders?
What usually happens otherwise? Would they do partly google stock, etc? And each shareholder gets some kind of multiple? (you get your N amount of Wiz shares X .72 = your number of google shares), or something of that sort?
- kadomony 2y agoYes. They became billionaires overnight.
- epolanski 2y agoAcquisitions often involve swaps of shares.
- bhouston 2y agoThe press releases say cash deal.
- whereismyacc 2y agoThe question was about what happens in other cases.
- thinkindie 2y agoOtherwise it depends on the deal structure. Especially if it's an acqui-hire, or founders are involved, it can be a combination of shares, options, earn-out, guaranteed bonus, certain salary levels (much higher then their current one) etc etc, and cash. Usually 100% cash deal is the most sought after unless the acquirer has a very solid business (in that case shares and options could be valuable too).
- jaimebuelta 2y agoThey say that's an all-cash purchase. So it seems that they really put $32bn in the bank account.
- bklyn11201 2y agoUltimately they are buying the shares of all existing shareholders. Wiz tells Google who the shareholders are after all triggers of options to shares are resolved. Then Google wires each shareholder after the signatures are complete. No money should go into Wiz bank account. 10-25% of the cash is held back to make sure the company and key employees fulfill promises made as part of the transaction.
- mikeyouse 2y agoRight - the Wiz bank account is about to be the Google bank account, so it wouldn't make any sense for them to receive the funds.
- exhibitapp 2y agoIn an all cash deal the Vendor (buyer) will purchase all shares of the Target (seller) for cash and cancel those shares. A substantial amount of the cash will be held back in escrow subject to a number of clauses and released at a future date. This will protect the buyer against misrepresentations. There are often also targets that have to be met to achieve the full purchase price but not always disclosed
- kgermino 2y agoYes on all of that. All Cash means Google is essentially writing a $32Bn check which is dispersed to the Wiz shareholders. (It wouldn't go to Wiz's bank account since Google owns the bank account once they send the money. Typically these involve at least some stock (cash + stock or all stock) which would mean that each Wiz share gets some amount of money and some multiple of Google stock per share.
- mlyle 2y ago> Does it literally mean that they are putting $32bn in Wiz's bank account (or probably some kind of escrow, who knows) which then gets dispersed to their shareholders? Google pays each of Wiz's shareholders 75-90% of the deal amount. The remainder is held in escrow and paid some time later based on a variety of conditions. > What usually happens otherwise? Would they do partly google stock, etc? And each shareholder gets some kind of multiple? (you get your N amount of Wiz shares X .72 = your number of google shares), or something of that sort? Yup, that's exactly how it works.
- financetechbro 2y agoPart of the acquisition process is putting together a “funds flow” which is simply a model that lays out how much $ each shareholder gets and then also you collect all the wire details, etc. But anyway, it can be a bit surreal seeing how much cash will be deposited into various accounts once the deal closes
- limaoscarjuliet 2y agoIt means if you were a shareholder of Wiz, you will have cash in your checking/savings account within few days and you will no longer have the shares.
- timcobb 2y agoWhat if I don't want to pay capital gains?
- lotsofpulp 2y agoThen you should not have owned assets that someone else had the power to sell.
- nextts 2y agoFor example: any publicly traded shares. I have had shares that are 1. force sold, 2. shares that were force split into two companies and 3. shares that are force acquired so they become another companies shares.
- nextts 2y agoLol coincidently had some publoc traded shares force sold last month. Didn't realize (they didn't send me an email). I have a weird ability to pick these kinda stocks! Unfortunately it hasn't been a profitable strategy.
- Cthulhu_ 2y agoThere's going to be teams of lawyers and financial managers that will guide that money into various financial structures and / or shell companies so that none of it shows up on the records used to calculate that.