Jurisdiction(s):
United Kingdom

Key definition

Acquisition finance definition

What does Acquisition finance mean? acquisition finance is the debt and/or equity raised to fund the purchase price and costs of an acquisition. It is a market term, not defined in legislation or case law, and is used across corporate, banking and leveraged finance practice. Funding may include bank term and revolving facilities, private credit/direct lending, bridge-to-bond loans, high‑yield bonds, mezzanine, vendor loan notes, and equity (for example, a share issue or private subscription). In leveraged buyouts it is commonly secured on the buyer/target group with upstream and cross‑stream guarantees, subject to corporate benefit, distributions rules and financial assistance restrictions. Across England & Wales,...

Acquisition finance: lenders' counsel guide to reviewing acquisition agreement conditions, warranties and indemnities, disclosure, seller protections and status, assignability, and related facilities and security documentation

Published by a LexisNexis Banking & Finance expert

Practice notes

In an acquisition finance deal, the buyer and seller settle the acquisition documentation between themselves, with the lenders’ lawyers given an opportunity to review and comment. Often, the lenders’ interests mirror those of the buyer, so a strong negotiating position on the buyer’s side will usually benefit the lenders as well.

This note highlights areas of particular interest for lenders’ lawyers in specific acquisition documents. More generally, they will wish to ensure that:

the target companies and/or assets correspond to lenders’ expectations in terms of identity and value
the acquisition contracts provide sufficient contractual protections to shield the target group from unforeseen financial liabilities
the acquisition documents address any key issues arising from the disclosure letter and the due diligence process

For an introductory overview of acquisition and leveraged finance, see Practice Note: Introductory guide to acquisition finance. For definitions of commonly used expressions, see our Glossary of acquisition finance terms and jargon. For further detail on the transaction suite, see Practice Note: Acquisition finance—key documents and parties...

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Web page updated on 21/05/2026

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