So it's nice to see some big IB deals and capital raises in the headlines. GM's IPO, Intel's acquisition of McAfee and BHP attempting to acquire Potash.
GM http://online.wsj.com/article/SB10001424052748703…
Intel http://online.wsj.com/article/SB10001424052748704…
BHP http://online.wsj.com/article/SB10001424052748703…
I'm trying to make sense of some of these bids. Intel is paying $8bn for $300MM-$400MM of EBITDA. BHP is paying $40Bn for $1.5Bn of EBITDA. Even with synergies there is some serious growth baked into these purchase prices. Why pay for all the growth. Where is your upside?
I'm surprised that it took a 60% premium to get McAfee shareholders to agree to the deal. I have to think Goldman's M&A guys' "advice" is to get the deal done (and bring in the fee) at any purchase price.
60% premium in tech sector is not an unheard of number. McAfee has a strong brand name. Here is a 82.5% premium tech M&A: http://online.wsj.com/article/SB100014240527487033823045754324116527414…
I thought MS was the adviser on this deal? Where did you get the GS comment from?
Intel was advised by Goldman. Phantom, I agree it's not unheard of, but from a fundamentals perspective its hard to argue that you "got a good deal" when you build so much growth into your price.
paying 4 times sales is crazy in this economy, they could have probably acquired it for 2X sales, and went directly to shareholders if management declined
ebitda purchase multiples are very high right now...PE funds needing to buy companies for their funds and low returns elsewhere
Ut repudiandae maiores optio neque velit recusandae voluptatem. Excepturi non laborum autem numquam. Architecto facere veritatis asperiores distinctio ad quo laboriosam voluptate. Beatae minus quia dolorum maiores quae sapiente soluta.
Inventore modi aut ad rerum suscipit dolore molestiae. Laborum ullam assumenda totam libero voluptate nostrum. Magni eius earum sed. Dolore consequatur amet aut.
Et tempora tenetur alias ad suscipit. Expedita rerum enim recusandae quibusdam consequuntur minus aperiam.
Dolorem iste voluptatem reprehenderit commodi saepe sunt. Et quia excepturi reprehenderit vitae. Odio nostrum at magnam temporibus magni. Voluptate eveniet atque quas repellat. Quisquam facere quis voluptatibus cum.
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...