Ch 5 · Mergers, Acquisitions & Corporate Restructuring

5 concept points · 4 formulas · 4 exam-critical points.

📘 Core concepts

• 1Types: Horizontal (same industry), Vertical (supply chain), Conglomerate (unrelated).
• 2Motives: synergy (cost/revenue), market power, tax benefits, diversification.
• 3Valuation: DCF, comparable company multiples, precedent transactions.
• 4Synergy = Value of combined firm − (Sum of standalone values).
• 5Defences: poison pill, white knight, golden parachute, crown jewel.