Add-On
Private Equity glossary · Valuation, Diligence, & Value Creation
Definition
A smaller acquisition made by a portfolio company to complement its existing business (also bolt-on or tuck-in).
Add-On in plain English
An add-on is when a company that a PE firm already owns buys a smaller company to bolt onto itself — also called a bolt-on or tuck-in. The goal is usually to make the bigger business more valuable: gain new customers, enter a new region, add a product, or cut costs by combining. It's like a growing burger chain buying up a few independent local burger joints and re-branding them — cheaper and faster than opening brand-new locations from scratch, and the combined chain is worth more than the pieces separately.
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