Data room

Physical room which is set up to contain all documents needed to be reviewed by a potential investor in order to assess an investment opportunity. Very often used by M&A advisors to canalise the various information requests of potential buyers and to limit their access to the management of the company to be sold.

Deal

Investment opportunity.

Deal flow

Deals proposed to a private equity investor. Allows the fund to measure its commercial efficiency vs peers.

Default

Happens when a bank covenant is not respected and early repayment of the loan can be requested by the lender.

Development capital

Type of transaction where private equity investors bring equity in mid-cap companies. The transaction is generally carried out through a capital increase in order to allow for additional growth, either internal or external. These transactions occur generally in case of high growth companies but which are already well established.

Downside/upside

Risk/opportunity in an investment.

Due Diligence

Analysis conducted in order to validate the assumptions of a business plan as well as the strengths and weaknesses, risks and opportunities of a deal. Due diligence are generally carried out by external advisors as well as the private equity firm.