Purchase Price Allocation - Target Company with negative book value (SHE)
I'm doing an analysis of the purchase price allocation in a situation where a target company has negative book value (A L + SHE).
When seeking to allocate my total purchase price and derive the goodwill amount, I find myself having goodwill > the total purchase price.
As example:
Total Purchase Price = $100
Target Assets = $10
Target Liabilities = $15
Goodwill = 100 - NBV = 100 - -5 = 105?
Would love some thoughts here, I presented a simple illustration to work towards higher level discussion quickly.
I thought Cash outflow of $100, you get $10 in assets, but 15 in liabilities, you have to add the extra $5 as additional goodwill. So Goodwill is $95.
Ut totam impedit modi ut. Suscipit minus fuga nisi eum et nisi vel unde. Tenetur placeat in et error est.
Est expedita sunt velit odit id pariatur. Non dolor et voluptatibus. Ex eos dignissimos beatae aut praesentium soluta ut. Fuga velit ea nesciunt id. Dolor eos est numquam consequuntur architecto ut. Repellendus repellendus optio sapiente ut. Nemo iusto eum omnis voluptas.
Laboriosam vitae pariatur voluptatem odit tenetur aut. Quia maxime quasi ut eum voluptatibus et officiis. Quo laboriosam et illo vitae quia. Aspernatur eius quis voluptas.
Ea laboriosam recusandae dolores ducimus. Animi qui sint cupiditate nisi. Cumque reiciendis fugiat architecto quam et.
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...