Respuesta :
A public strategic buyer uses all of the following in formulating its bid price for a given target excepted Stapled Financing.
What is Stapled Financing?
- A pre-arranged finance package known as staple financing, is made available to potential buyers of an acquisition.
- The investment bank helping the selling firm arranges staple financing, which comprises all information about the lending package, such as the principal, fees, and loan covenants.
- The name comes from the fact that the acquisition term sheet's back is stapled with the financing information.
- A sort of M&A financial modeling known as accretion/dilution analysis is carried out in the pre-deal phase to assess the impact of the transaction on shareholder value and to determine if EPS for buying shareholders would rise or fall after the acquisition.
- In general, shareholders do not like dilutionary deals; nevertheless, a proposed combination is justified if it has the potential to create enough value to become accretive in a fair amount of time.
- While two businesses come together, their financial operations are improved to a higher extent than they were when the businesses were operating independently. This is known as financial synergy.
- Typically, M&A deals produce a larger company with more negotiating leverage to obtain a lower cost of capital. A merger or acquisition that results in a cheaper cost of capital is an example of financial synergy.
- Synergy in mergers and acquisitions occurs when the value created by combining two businesses is greater than the value created by the businesses operating independently.
Know more about Synergies https://brainly.com/question/26886908
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