- Debt and Equity Structure: The financial structure involves a mix of debt and equity, with debt typically being the larger portion. - Target Company: The company being acquired must have stable and predictable cash flows to service the debt. - Financial Projections: Detailed financial models project the future performance of the target company, including revenue, expenses, and cash flow. - Exit Strategy: The acquiring company usually has a plan to sell the target company or take it public after improving its financial performance.