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Webster's New World Finance and Investment Dictionary » backstopped deal
backstopped deal
backstopped deal definition - finance
A
type of underwriting deal in which the underwriter offers a firm commitment to
purchase the companyÂ’s securities, thereby assuming the risk if the deal is
poorly received by the market. The underwritersÂ’ fee is the spread, the difference between the price
at which the securities were purchased from the com-pany and the price at which
they were sold to the public. Also called firm-commitment
underwriting or bought deal.
Webster's New World Finance and Investment Dictionary Copyright © 2003 by Wiley Publishing, Inc., Indianapolis, Indiana.
Used by arrangement with John Wiley & Sons, Inc.
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