Dry powder

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Dry powder means cash or near-cash kept on hand by an organisation to meet future financial obligations or other expenditure.

Private credit funds have dry powder
"PwC adds that private credit funds still have plenty of dry powder that they’re motivated to put to work.
'We estimate this to be more than €50bn across Europe at the latest count,' the firm says. 'We’ve seen them offering finance to some of the larger corporates as an alternative to the high-yield bond and leveraged loan markets. By clubbing together, private credit funds can provide significant levels of finance to large clients, while sticking within their individual credit ceilings.'"
Refinancing costs rocket - Philip Smith - The Treasurer - Issue 2, 2024, p21.

2. Mergers & acquisitions (M&A).

In the context of M&A, dry powder means the amount of capital that is available to financial or strategic buyers for investment in strategic acquisitions, portfolio companies or add-on acquisitions.

The term originates from the historical use of gunpowder in the military.

A reserve of dry gunpowder was essential to firing weapons.

See also