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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Share for share exchange
Dear John,
In acquisition, when the predator offer share for share exhange, the value of predator exchanged share should be used is pre-acp or post-acq ( eg the value of combined company/the total shares issues), pls advise
It depends from whose perspective we are looking.
The company doing the acquiring will have information enabling them to forecast the new share price, and this will then determine what they can afford to offer.
The shareholders of the company being acquired will not have the information and so will base their thinking on the existing share price.
Much appreciate your help, John
You are welcome 🙂