Glossary

Rating

A rating is the assessment of the creditworthiness of debtors.

Recapitalization

Recapitalization refers to the change in capital resources or capital structure.

Receivables

The term Receivables is the English term for the receivables of a company.

Red Flag Report

A Red Flag Report is a concise Due Diligence Report (see also Due Diligence), which lists only the problem areas.

REIT

REIT is the abbreviation for Real Estate Investment Trust. This is a form of investment that enables investment in real estate on the basis of exchange-traded shares.

Representations & Warranties

Representations & Warranties (in short Reps) are an expression of the seller's warranties regarding the legal and economic circumstances of the target company.

Reps

The term Reps is a colloquial term for Representations & Warranties, meaning the seller's warranties regarding the legal and economic circumstances of the target company.

Resolution

A resolution is a formal decision taken, for example by a board of directors.

Restructuring

The restructuring measures of a company are also called restructuring.

Retainer

The basic remuneration of an M&A consultant is called retainer. It is in contrast to the success fee (see also Success Fee) and the transaction fee (see also Transaction Fee).

Return on Capital Employed

Return on capital employed (RoCE for short) is a profitability indicator in which net income (see also net income) is set in relation to capital employed (see also capital employed).

Return on equity

Return on equity (RoE for short) is the English term for the return on equity.

Return on investment

Return on Investment (RoI) is a performance indicator of an investment. It is calculated from the net proceeds (cash flow minus invested funds) by invested funds.

Reverse engineering

The term reverse engineering refers to the reconstruction of a product. For example, in the run-up to company mergers, it is discretely examined how products are manufactured at the target company by dismantling the product into its individual parts and examining them. This makes reverse engineering a very effective competitive analysis instrument.

Reverse Takeover

A reverse takeover refers to a situation in which an acquired company reverses the takeover and gains control over the acquirer.

Right of First Refusal

The Right of First Refusal is the English term for a pre-emptive right. It is in contrast to the Pre Emptive Right, as it does not require a contract with a third party.

Risk Adjusted Rate

In a company valuation, a risk adjusted rate refers to a discount rate that includes a risk premium.

Risk management

Risk management is a management task that aims to identify and manage risks.

RoCE

RoCE is the abbreviation of return on capital employed and is a profitability indicator that compares net income (see also net income) with capital employed (see also capital employed).

RoE

RoE is the abbreviated form of the term Return on Equity.