6. Mergers & Acquisitions Modeling

Overview

Video Hours: 5 | Mentoring Session: 1

This module explores the fundamental concepts of Mergers and Acquisitions, and how to effectively analyze a potential M&A transaction. What makes a company a good target? Why would a company make an acquisition? Will the transaction be accretive or dilutive? These are some of the key questions Investment Bankers deal with daily. Students will create a complete merger model done by Wall Street Analysts and analyze the transaction to determine if the deal is accretive or dilutive.

Topics Covered

  • Affordability analysis
  • Purchase accounting overview
  • Creation of goodwill and write-ups
  • Sources and uses of funds
  • Opening balance sheet and purchase accounting adjustments
  • Pro forma income statement
  • Accretion/dilution analysis
  • Credit rating considerations
  • M&A transaction considerations (stock vs. cash, social issues, etc.)
  • Asset vs. stock purchase
  • Tax deductibility of goodwill