Leaseback
 |
Definition of 'Leaseback'An arrangement where the seller of an asset leases back the same asset from the purchaser. In a leaseback arrangement, the specifics of the arrangement are made immediately after the sale of the asset, with the amount of the payments and the time period specified. Essentially, the seller of the asset becomes the lessee and the purchaser becomes the lessor in this arrangement. |
 |
Investopedia explains 'Leaseback'A leaseback arrangement is useful when companies need to un-tie the cash invested in an asset for other investments, but the asset is still needed in order to operate. Leaseback deals can also provide the seller with additional tax deductions. The lessor benefits in that they will receive stable payments for a specified period of time.Also known as a "sale and leaseback." |
Related Definitions
Articles Of Interest
-
New Wheels: Lease Or Buy?
These two major ways to obtain a car have very different advantages and drawbacks. Find out which is best for you. -
Top 8 Ways Companies Cook The Books
Find out more about the fraudulent accounting methods some companies use to fool investors. -
Rent-To-Own Real Estate Full Of Pitfalls
Before you consider this type of arrangement, you should be aware of how it works, who benefits and the many things that can go wrong. -
Rent To Own; Own To Rent
This method can help first-time buyers afford a home using a rent-to-own strategy, and it can also be good for investors. -
Uncovering Hidden Debt
Understand how financing through operating leases, synthetic leases, and securitizations affects companies' image of performance. -
Weighted Average Cost Of Capital (WACC)
Weighted average cost of capital may be hard to calculate, but it's a solid way to measure investment quality -
What is a monopoly?
Monopoly is a fun family game, but in real life, a monopoly can be dangerous to a country's economy. A monopoly occurs when an industry or sector has only one producer of goods or retailer for ... -
Capital Expenditures (CAPEX)
Learn more about what it costs to produce goods. -
Working Capital
Working capital is one of the basic metrics used to evaluate a company's financial health. Find out what it can tell you about a stock and learn how to calculate it. -
What is the difference between "hard money" and "soft money"?
Hard money and soft money are terms that are often used to describe coin money and paper money, respectively. However, these terms are also used to refer to political contributions in the United ...
Free Annual Reports