Strategic Buyer

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Dictionary Says

Definition of 'Strategic Buyer'

A type of buyer in an acquisition that has a specific reason for wanting to purchase the company. Strategic buyers look for companies that will create a synergy with their existing businesses.

Because strategic buyers may actually get more value out of an acquisition than the intrinsic value of the company being acquired, strategic buyers will usually be willing to pay a premium price in order to have the deal go through.

Also known as synergistic buyers.

Investopedia Says

Investopedia explains 'Strategic Buyer'

Strategic buyers can come in many forms. A strategic buyer could be a competitor or a company in the same industry that wants to move into a new region. Purchasing an existing company in a new region may be more cost effective than starting new operations themselves. 

Another possibility could be a company in an unrelated business, seeing that the company being acquired has strengths that could help their existing business. An example of this is a food manufacturer acquiring a supply-chain management/logistics firm.

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'Strategic Buyer'

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    ... It is also important to note that this is the stand-alone value of the company and
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    ... to benefit from a number of angles: sales and profit could return to the double
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    ... whether the potential target is open to exploring a "strategic alternative" or ... other
    outstanding or potential liability obligations so that the buyer can have ...

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