easy · Investment Banking ma-lbo

In a merger model, what is the 'Exchange Ratio'?

  1. The ratio of the acquirer's P/E to the target's P/E
  2. The percentage of cost synergies realized in the first year after the transaction
  3. The number of acquirer shares issued for each share of the target company
  4. The amount of cash paid to target shareholders relative to the amount of stock issued

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