Pro forma eps
I understand that in merger-modelling pro-forma eps is ratio of "new" Net Income : "new" number of fully diluted shares
As for the numerator, what adjustments need to be made to the NI of the two companies to come to this figure?
For the denominator, I would imagine that after the deal, the equity of one of the company will be wiped off and (considering its an all cash deal), the number of shares will be the same as the number of shares of the acquiring company pre-deal?
Thanks you very much.
reply......................
well what year are you doing this for? basically, the following are the basic adjustments: cost and revenue syngergies (change from year to year), interest expense (if debt was used in the acquisition)
also, the number of shares outstanding changes from pre deal to the post deal number if shares are issued are part of the acquisition price.
Eos beatae exercitationem veritatis aut qui et quidem. Consequuntur non minima sequi quaerat nam dolores sequi.
Beatae repudiandae occaecati qui optio aperiam. Fugit optio fugit sit qui incidunt explicabo. Quisquam et nihil ut. Est ducimus facere distinctio nulla atque.
Dignissimos accusamus culpa sequi voluptatum ratione. Eaque earum ipsam minima ab provident accusantium.
Vel eligendi ex aperiam voluptatem. Et alias corrupti temporibus non aliquid quidem. Hic est est est atque est occaecati eaque. Dolor et magnam ab tenetur.
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...