why are we not adding both the companies earnings for additional earnings or eps
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nento co (june 12)
2y ago#1I do not know which of the two offers you are referring to.
For the share for share offer, the are adding the earnings (and the synergy) and then multiplying by the PE ratio.
For the cash offer, given that the number of shares remains the same it is simpler just to take the extra earnings (and synergy) and multiply by the PE ratio. I assume that when you answered you did add to the existing earnings, but the end result would have been the same.
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