Let's assume that buyer A buys from seller B an asset C. Let's assume that A and B have agreed to the following EV bridge:
Financial Debt: 300
Unfunded Pensions 100
Excess cash: 100
This would lead us to a simplified equity valuation of 700. Now the deal is signed.
How would the purchase price get reconciled?
- Would A simply transfer the 700 to B?
- Would A simply transfer 300 to the current lender (e.g., funded by new debt raised for the deal)?
Thanks a lot in advance for any help!