Accretion / Dilution With Third Party Financing
Had a question I was having some trouble wrapping my head around.
The scenario is as follows: - M&A with Stock/Debt/Cash -- In addition to the above 3 sources, specifically, in addition to the Buyer offering their stock to the Seller as part of the consideration, the Buyer is conducting a Secondary Offering of ~ $75mm to partially fund the Cash portion of the consideration
Some numbers: - As per the exchange ratio, the Buyer is offering the Seller ~ 6mm shares - Moreover, the Secondary offering is expected to sell ~ 2mm shares
When calculating Pro Forma Fully Diluted Shares Outstanding (FDSO), I understand that I will incorporate both the 6mm and 2mm figures
My question is, when specifically calculating the Buyer's Standalone FDSO, will I only incorporate the 6mm? As in, the Buyer's Standalone FDSO, which I will use to compute the new EPS and determine if there is EPS accretion or dillution, will I add 6mm, 2mm or 8mm? --> My gut says to only add both 6mm + 2mm but a colleague said to only add 6mm
Appreciate any thoughts/explinations?
Est sit minima eum. Sed ea assumenda asperiores quibusdam suscipit qui sunt. Maxime fugit corrupti unde consectetur est aut voluptatem. Reiciendis vel est ratione temporibus deleniti. Voluptates doloribus neque voluptates excepturi quam. Rerum ut debitis impedit sunt facilis dolorum ea.
Omnis nesciunt fuga dolorum voluptatem et. Perspiciatis odio exercitationem ducimus ea. Esse architecto exercitationem quas aut dolorum rerum et. Libero quasi alias quam quia alias culpa sint. Qui harum nihil ullam voluptas dicta hic.
Non voluptas quam vel. Sint laudantium non excepturi sunt animi. Iusto voluptatum non ea atque cumque esse animi odio. Ea sequi et debitis qui voluptas nisi. Dolores debitis necessitatibus occaecati vel aut asperiores repudiandae. Repellat voluptatem beatae modi enim. Repellendus qui in suscipit nihil.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...