A Practical Guide to Mergers and Avquisitions
A PRACTICAL GUIDE TO MERGERS, ACQUISITIONS, AND DIVESTITURES
Delta Publishing Company
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Copyright © 2009 by DELTA PUBLISHING COMPANY P.O. Box 5332, Los Alamitos, CA 90721-5332
All rights reserved. No part of this course may be reproduced in any form or by any means, without permission in writing from the publisher.
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TABLE OF CONTENTS CHAPTER 1 MERGERS AND ACQUISITIONS CHAPTER 2 DIVESTITURE GLOSSARY
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CHAPTER 1 MERGERS AND ACQUISITIONS LEARNING OBJECTIVES: After studying this chapter you will be able to: 1. Define mergers. 2. List twelve conditions required to merge. 3. Define and perform due diligence. 4. Identify information to consider before "doing a deal” 5. Describe antitrust guidelines 6. Explain M & A percent rules. 7. Plan for mergers and acquisitions. 8. Decide on acquisition terms. 9. List factors in determining a price. 10. Describe grading criteria. 11. Summarize acquisition strategy and process. 12. Finance the merger. 13. Use capital budgeting techniques for M&A analysis. 14. Explain the effect of merger on earnings per share and Market price per share. 15. Describe the risk of the acquisition. 16. Explain the methods of hostile takeover bids. 17. Outline SEC filing requirements and tax considerations 18. Enumerate defensive measures by targeted company. 19. Determine the value of a targeted company. 20. Describe accounting, reporting and disclosures for business combinations 21. Discuss the importance of corporate development officers (CDOs)—M&A teams For years, academic studies maintained mergers and acquisition (M&A) deals destroyed shareholder value. In 2006, however, businesses around the globe bought (and therefore sold) more companies for more money than ever. It was not just a year of record merger volume more than $3,800 billions - but also a merger market with unprecedented breadth, across geographies and industries. M&A transactions in the current merger cycle differ in significant ways from those of the 1990s, and
Delta Publishing Company
1
Copyright © 2009 by DELTA PUBLISHING COMPANY P.O. Box 5332, Los Alamitos, CA 90721-5332
All rights reserved. No part of this course may be reproduced in any form or by any means, without permission in writing from the publisher.
2
TABLE OF CONTENTS CHAPTER 1 MERGERS AND ACQUISITIONS CHAPTER 2 DIVESTITURE GLOSSARY
3
CHAPTER 1 MERGERS AND ACQUISITIONS LEARNING OBJECTIVES: After studying this chapter you will be able to: 1. Define mergers. 2. List twelve conditions required to merge. 3. Define and perform due diligence. 4. Identify information to consider before "doing a deal” 5. Describe antitrust guidelines 6. Explain M & A percent rules. 7. Plan for mergers and acquisitions. 8. Decide on acquisition terms. 9. List factors in determining a price. 10. Describe grading criteria. 11. Summarize acquisition strategy and process. 12. Finance the merger. 13. Use capital budgeting techniques for M&A analysis. 14. Explain the effect of merger on earnings per share and Market price per share. 15. Describe the risk of the acquisition. 16. Explain the methods of hostile takeover bids. 17. Outline SEC filing requirements and tax considerations 18. Enumerate defensive measures by targeted company. 19. Determine the value of a targeted company. 20. Describe accounting, reporting and disclosures for business combinations 21. Discuss the importance of corporate development officers (CDOs)—M&A teams For years, academic studies maintained mergers and acquisition (M&A) deals destroyed shareholder value. In 2006, however, businesses around the globe bought (and therefore sold) more companies for more money than ever. It was not just a year of record merger volume more than $3,800 billions - but also a merger market with unprecedented breadth, across geographies and industries. M&A transactions in the current merger cycle differ in significant ways from those of the 1990s, and