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published on 15 September 2023 | reading time approx. 3 minutes
Contingent considerations (so-called “earn-outs”) in European transactions have significantly gained in importance in recent years. The share of transactions with earn-out clauses has now risen to 27 per cent (CMS European M&A Study 2023). This instrument is used particularly frequently in sectors whose development is strongly marked by uncertainty (e.g. pharmaceuticals, technology, or start-ups). The following article addresses the accounting and valuation of earn-out clauses.
Christoph Hirt
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Christian Krämer
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Transaction advisory | Mergers & Acquisitions