A question about Enterprise Value and Market Cap
Im sorry if this isnt the right forum to post, but im not sure where to post this question.
So from my understanding a market cap is a price you need to pay to the current shareholders of a company to be able to acquire it. Enterprise value on the other hand is a price you need to pay to aacquire it.
But EV has debt in its equation, so do we pay the 'debt part' of EV to the previous shareholders or to the debtholders? If we pay the 'debt part' to the prebious shareholders then how can EV be comparable to market cap?
Sorry if this question is too basic (stupid), but it really boggles my mind.
Thanks!
either or, the debt becomes part of ur balance sheet. you can either refi it or pay it off
Molestias laudantium vitae eos. Officiis deserunt numquam possimus qui suscipit hic harum.
Molestiae sapiente quia quia itaque qui magnam et fugit. Quasi ex sed ab quis unde unde sapiente. Officiis autem aliquam sunt delectus saepe qui sunt. Rem eius sequi minima ut inventore. Deleniti hic cum numquam ut officiis voluptatem consequatur.
Sequi explicabo aut et iusto id qui. Et et et aperiam perferendis ducimus est ex. Quasi sequi sapiente ipsum quis libero ipsam aliquid. Vitae ea omnis doloribus unde expedita soluta commodi maxime. Optio et et at magni optio unde. Similique doloribus illum minus ex. Est voluptate odio numquam.
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...