A corporate structure is the preferred post-closing organization when an earn-out is involved in acquiring the target firm.

Question

Quizplus · Accepted Answer

An earn-out often involves specific performance metrics or goals that the target firm must achieve post-acquisition, which can be more flexibly managed and adjusted within a less rigid organizational structure than a traditional corporate structure. This allows for more direct oversight and integration efforts tailored to achieving the earn-out conditions.

A Corporate Structure Is the Preferred Post-Closing Organization When an Earn-Out