Key concepts of pricing
Once the valuation has been done and the company is convinced that acquiring the other company would be beneficial for it in the future then a deal has to be made with the other company. For this an appropriate price has to be quoted.
The key concepts involved in pricing in M&A are
- Offering a price: After taking into consideration, all the values deduced from the valuation process, the company planning to acquire the other company has to tender an offer. This involves buying some shares in the target company.
- Declaration of interest: In this the company needs to file a request with the SEC and formally declare that it is interested in acquiring the other company.
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