Implied EV

How do you calculate an implied EV of a transaction? Is this the EV of the target?

Implied EV Calculation

When trying to calculate the implied enterprise value, there are multiple ways to get there. WSO members provided the following formulas:

  • Implied EV of a transaction = market cap + net debt
  • Deal Value = amount Paid
    Eq Value = Deal Value/% acquired (100%)
    Net Debt= Net Assumed Liabilities
    Implied EV= Eq Value + Net Debt which already takes into account Cash
  • Target Purchase Price / Target EBITDA = EV/EBITDA
    Target Purchase Price = Fully Diluted Market Cap (premium incorporated) + Debt + Minority Interests + Preferred Stock - Cash
    Implied EV = EV/EBITDA * EBITDA

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