From a valuation perspective, the most important factors in an M&A MODEL are synergies, the form of consideration (cash vs shares), and purchase price. Synergies enable the acquiring company to realize value by enhancing revenue or reducing operating costs, and this is TYPICALLY the biggest driver of value in an M&A deal (note: SYNERGY VALUES are very hard to estimate and can often be overly optimistic).

The mix of cash vs share consideration can have a major IMPACT on accretion/dilution of per share metrics (such as EPS). To make a deal more accretive, the acquirer can add more cash to the mix and issue fewer shares. Finally, the purchase price and takeover premium are major factors in the value that’s created.

From a valuation perspective, the most important factors in an M&A model are synergies, the form of consideration (cash vs shares), and purchase price. Synergies enable the acquiring company to realize value by enhancing revenue or reducing operating costs, and this is typically the biggest driver of value in an M&A deal (note: synergy values are very hard to estimate and can often be overly optimistic).

The mix of cash vs share consideration can have a major impact on accretion/dilution of per share metrics (such as EPS). To make a deal more accretive, the acquirer can add more cash to the mix and issue fewer shares. Finally, the purchase price and takeover premium are major factors in the value that’s created.