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These deals are mostly in stock, not cash. $3b cash is not something most companies can afford to part with, and additionally, making deals that are stock-heavy
by rchaud 1y ago
These deals are mostly in stock, not cash. $3b cash is not something most companies can afford to part with, and additionally, making deals that are stock-heavy creates an incentive for the leadership of the acquired company to keep working towards the general interest of OAI, and not instantly retire.
- JumpCrisscross 1y ago> These deals are mostly in stock, not cash How are you defining “these deals”? Most acquisitions of startup by larger companies in America over the last decade, at least, have been all cash.
- rchaud 1y agoI'd define them as a large company acquiring a private startup. Slack >> Salesforce was a cash-and-stock deal. Postmaters >> Uber, all stock. In cases where the company being acquired is already publicly traded, those deals would have to be all cash as their shareholders would need to be bought out. IBM paid cash for Hashicorp, and Doordash will acquire Deliveroo in cash.
- JumpCrisscross 1y ago> I'd define them as a large company acquiring a private startup. Slack >> Salesforce was a cash-and-stock deal. Postmaters >> Uber, all stock Okay, in that category of M&A in practically any category, the vast majority of deals are all cash. Deferred, for executives, in most cases. But cash. > In cases where the company being acquired is already publicly traded, those deals would have to be all cash as their shareholders would need to be bought out Not true. Preferable. Easier. Not not a requirement.