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Define M&A motives, types of M&As and valuation techniques

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1.) Explain one motive for pursuing a M&A?
2.) Define and provide an example of one commonly used term in M&A?
3.) Define three types of M&A's?
4.) Explain two types of valuation techniques?
5.) List two types of financial instruments for M&A's?
6.) What is the purpose of the appraisal technique when valuing a firm?
7.) Are there any anti-trust dimensions in assessing the the effects of M&A activities? Explain your response.
8.) How does Cost reduction play a role in M&A's?
9.) List and explain two types of divestitures?
10.) Why wouldn't a divestiture be pursued?

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Solution Summary

The expert defines M&A motives, the type of M&As and valuation techniques.

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Answers:

1) Diversification can be one motive of pursuing an M&A.
2) Synergy
3) Horizontal, Vertical and Conglomerate merger and acquisition.
4) Discounting cash flow and option pricing model technique.
5) Equity and debt
6) The ...

Solution provided by:
Jayant Kumar, MBA
Education
  • MBA, Indian Institute of Finance
  • Bsc, Madras University
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