A net debt adjustment is the step in a company acquisition that converts the headline price into the amount actually paid for the shares. Buyers usually value a business on a cash-free, debt-free basis, known as enterprise value. Because the buyer takes on the company with whatever borrowings and cash it holds on the day of completion, the agreed price is reduced by the debt and increased by the cash, giving the equity price.
The sale agreement defines what counts. Beyond bank loans, debt-like items often include lease liabilities, unpaid tax, overdue creditors, pension deficits and deal bonuses, and cash that cannot be freely used may be excluded. These definitions are heavily negotiated. The figure is estimated at completion and trued up afterwards using completion accounts, normally together with a working capital adjustment. Both are forms of purchase price adjustment; a locked-box mechanism fixes the price in advance instead.