A price adjustment is a post-signing mechanism in an M&A SPA that modifies the provisional acquisition price based on verified financial data at or after closing — primarily completion accounts (working capital and net debt measured at closing) or earn-out achievement. Price adjustments protect both parties: the buyer against overpaying for a business that deteriorated between signing and closing, and the seller against underpayment if the business performed better than estimated. Their calculation requires agreed accounting principles, reference definitions and a dispute resolution mechanism.

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Example: an acquisition is signed at CHF 16.0 million based on estimated working capital of CHF 3.0 million and net cash of CHF 500,000. Completion accounts show actual working capital of CHF 2.6 million (-CHF 400,000) and cash of CHF 650,000 (+CHF 150,000). Net price adjustment = -CHF 400,000 + CHF 150,000 = -CHF 250,000 in favour of the buyer — final price CHF 15.75 million.

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Hectelion prepares and challenges price adjustments for sellers and buyers in completion accounts proceedings, applying rigorous accounting analysis to every component.