Valuing spin-offs pre-separation
Hi all,
Am learning more about special situations, and had a few questions about valuing spin-offs pre-separation.
Assuming it's a pure 100% spin-off, where say the owners of the parent get 1 share of the spinco for every 5 shares of parentco, is the implied value of the spin-off simply the parent's share price * 5 and then you can multiply this by the parents shares outstanding / 5 to get the implied market cap?
Also when pro forma financials are provided, will the pro forma capitalization from the parent's investment change based on the actual parentco share price on separation date?
Thanks in advance
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