Parties to a business transaction, whether structured as a purchase of equity or assets, typically agree on a method to adjust the purchase price based on the net working capital of the acquired ...

Net working capital is positive if short-term assets exceed liabilities. Yearly net working capital change occurs from balance sheet variations. A significant increase in accounts payable can reduce ...

Capital expenditures (CAPEX) and net working capital are both essential for the short-term and long-term success of a company. However, there are distinct differences between the two metrics. Net ...

Companies need capital to remain operational and grow, and the amount of capital a company has is a strong indicator of its financial health. Working capital can be divided into two categories: gross ...

Net working capital (“NWC”) is often a highly scrutinized component in M&A deals and can significantly impact the purchase price. NWC represents the liquidity a company needs to run its day-to-day ...

This article is part of a continuing series on recurring issues of critical importance to sellers in private company M&A. Previous topics include equity rolls. Net Working Capital (“NWC”) targets and ...

Low working capital may signal financial risk or smart management. Discover how to assess its impact on a company's financial ...

Gregory Milano is founder and CEO of Fortuna Advisors LLC and author of Curing Corporate Short-Termism, Future Growth vs. Current Earnings. Many executives, especially those with a finance background, ...