medium · Investment Banking ma-lbo
AcquirerCo, with a P/E ratio of 20x, is considering an all-stock acquisition of TargetCo, which has a P/E ratio of 15x.
Assuming no synergies and a standard control premium, which of the following describes the most likely impact on AcquirerCo's Earnings Per Share (EPS)?
- The deal will be accretive
- The deal will be neutral
- The impact depends solely on the size of the companies
- The deal will be dilutive
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