FIN 679 AU Calculate the Merger Premium of The Target Company Analysis
Question Description
I’m working on a finance discussion question and need a sample draft to help me learn.
Complete an environment scan and Internet search to determine how investment bankers look at comparable acquisitions to determine prices for a target company in a merger and/or acquisition. Consider your chosen target company and create a one-page executive summary document that includes the following elements:
- Explain the various guidance and/or pricing benchmarks you found regarding a reasonable price to pay for acquisitions of publicly traded firms comparable to your target company.
- Explain the process you would use to calculate the merger premium for your target company. Provide a rationale for why the merger premium should be computed using the share price 30 days before the initial announcement of the acquisition.
- Explain how the discounted cash flow (DCF) analysis and the net present value (NPV) calculation will be useful for the acquisition of your target company.
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