medium · Principles of Finance valuation
Acquirer A (EPS = 5.00, P/E = 20x) buys Target T (EPS = 5.00, P/E = 15x) in a 100% stock-for-stock deal at a 20% premium. Acquirer has 100 million shares; Target has 20 million shares.
Is the deal accretive or dilutive?
- Accretive
- Dilutive
- Cannot be determined without synergy values
- Neutral (No impact)
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