medium · Investment Banking ma-lbo
An acquirer with 100 million in Net Income and 50 million shares outstanding (2.00 EPS) buys a target with 20 million in Net Income. The purchase is financed by issuing 10 million new shares.
If there are 5 million in after-tax synergies, what is the percentage accretion/dilution?
- 2.50% accretion
- 8.33% accretion
- 4.17% accretion
- 2.00% dilution
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