What Is A Premium?

In a deal scenario, a premium is the difference between the amount paid and the value of the company. This premium usually illustrates the amount of goodwill in the target company and also how much the acquirer is committed to the deal and improving the future performance of the target firm.

To learn more about this concept and become a master at M&A modeling, you should check out our M&A Modeling Course. Learn more here.

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