Indication of Interest (IOI)
A preliminary proposal made by a buyer to express interest in acquiring the target company, usually including an initial offer price.
Implications
A non-binding statement from a potential buyer expressing preliminary interest in acquiring a company or asset, often used in the early stages of mergers and acquisitions to gauge interest and set the stage for more detailed negotiations.
Example
Example: A private equity firm submits an Indication of Interest to a tech startup, outlining its preliminary valuation and the terms under which it would consider making a formal acquisition offer.
Related Terms
Different from a Letter of Intent (LOI), which is more formal and often includes specific terms, an IOI is an initial, non-binding expression of interest that signals intent to explore a potential deal.
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