Exchange Ratio Determination in a Market Equilibrium
Managerial Finance, volume 34, number 4, 2008, pp. 262-270
15 Pages Posted: 5 May 2013
Date Written: April 21, 2008
The paper aims to present an exchange ratio for merging companies that incorporates the change in the level of riskiness. Its main objective has been achieved exploiting CAPM offers a formula that determines a risk-adjusted exchange ratio that takes into account both risk and synergy.
Keywords: Acquisitions and mergers, Exchange ratio determination
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