Ch 5 · Mergers, Acquisitions & Corporate Restructuring

🧮 Formula sheet

1. 1.Synergy = V(AB) − V(A) − V(B)
2. 2.Max exchange ratio acquirer can offer = (P_A × N_A) + Synergy ÷ P_AB
3. 3.EPS Post-merger = (NI_A + NI_B) / (N_A + ER × N_B)
4. 4.P/E based valuation: Value = EPS × P/E