Direct Investment


DEFINITION of 'Direct Investment'

1. The purchase or acquisition of a controlling interest in a foreign business by means other than the outright purchase of shares.

2. In domestic finance, the purchase or acquisition of a controlling interest or a smaller interest that would still permit active control of the company.

BREAKING DOWN 'Direct Investment'

The purpose of a direct investment is to gain enough control of a company to exercise control over future decisions. This can be accomplished by gaining a majority interest or a significant minority interest. Direct investments can involve management participation, joint-venture or the sharing of technology and skills.

  1. Board Of Directors - B Of D

    A group of individuals that are elected as, or elected to act ...
  2. Control Stock

    1. Equity shares owned by major shareholders of a publicly traded ...
  3. Controlling Interest

    When one shareholder or a group acting in kind holds a high enough ...
  4. Minority Interest

    1. A significant but non-controlling ownership of less than 5 ...
  5. Majority Shareholder

    A person or entity that owns more than 50% of a company's outstanding ...
  6. Skinny Down Distribution

    Skinny down distribution is corporate practice of slimming down ...
Related Articles
  1. Investing

    Investing In Brazil 101

    Brazil is well positioned for future growth, and luckily for investors, it also has a very liberal investing climate.
  2. Entrepreneurship

    Top 6 Factors That Drive Investment In China

    FDI in China surpassed $100 billion in 2010, certain key factors drive foreign direct investment.
  3. Stock Analysis

    A Quick Look at Rite Aid's History

    Discover the history of Rite Aid, the third-largest U.S. drugstore chain. Learn about a potential merger that could drastically change the industry.
  4. Financial Advisors

    Are Alternatives Right for Your Portfolio?

    Alternative investments are increasingly making their way into retail investors' portfolios. Are they a good fit?
  5. Entrepreneurship

    The Top 4 Social Venture Capital Firms

    Learn how social venture capitalists are investing in companies more focused on making the world a better place to live than returns on investments.
  6. Markets

    10 Most Famous Leveraged Buyouts

    Learn about the boldest, riskiest leveraged buyouts in history and how they either become famous for failing miserably or making billions.
  7. Entrepreneurship

    Startups That Got Screwed by Venture Capital

    Venture capital support can make or break a startup. But before taking the cash, founders should make sure they are not making a deal with the devil.
  8. Stock Analysis

    Is There Any Upside Left for Walgreens?

    Walgreens is about to get much bigger, but does bigger equal better in this case?
  9. Entrepreneurship

    Does Your Startup Need Venture Capital Money?

    Venture capital funding provides capital to grow a business. However, entrepreneurs will also lose some control over business decisions.
  10. Professionals

    Alternative Investments: Are They Right for You?

    Alternative investments can provide unique benefits to clients for whom they are suitable. But do your due diligence and beware of the risks.
  1. Is a Canadian resident allowed to participate in a direct stock purchase plan from ...

    There is no law that prevents Canadians from participating in direct stock purchase plans offered by U.S. companies. There ... Read Full Answer >>
  2. Do hedge funds invest in private companies?

    Hedge funds normally do not invest in private companies because of liquidity concerns. Capital funding for private companies ... Read Full Answer >>
  3. Who do hedge funds lend money to?

    Many traditional lenders and banks are failing to provide loans. In their absence, hedge funds have begun to fill the gap. ... Read Full Answer >>
  4. How long does it take to execute an M&A deal?

    Even the simplest merger and acquisition (M&A) deals are challenging. It takes a lot for two previously independent enterprises ... Read Full Answer >>
  5. How do you find the break-even point using a payback period?

    It does not make sense to find the breakeven point using a company's payback period. A company's payback period is concerned ... Read Full Answer >>
  6. What happens to the shares of stock purchased in a tender offer?

    The shares of stock purchased in a tender offer become the property of the purchaser. From that point forward, the purchaser, ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Bar Chart

    A style of chart used by some technical analysts, on which, as illustrated below, the top of the vertical line indicates ...
  2. Bullish Engulfing Pattern

    A chart pattern that forms when a small black candlestick is followed by a large white candlestick that completely eclipses ...
  3. Cyber Monday

    An expression used in online retailing to describe the Monday following U.S. Thanksgiving weekend. Cyber Monday is generally ...
  4. Take A Bath

    A slang term referring to the situation of an investor who has experienced a large loss from an investment or speculative ...
Trading Center