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Exchange Ratio Determination in a Market Equilibrium

Managerial Finance, volume 34, number 4, 2008, pp. 262-270

15 Pages Posted: 5 May 2013  

Enrico Moretto

University of Insubria - Department of Economics; CNR - IMATI

Stefano Rossi

Stockholm School of Economics

Date Written: April 21, 2008

Abstract

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

Suggested Citation

Moretto, Enrico and Rossi, Stefano, Exchange Ratio Determination in a Market Equilibrium (April 21, 2008). Managerial Finance, volume 34, number 4, 2008, pp. 262-270. Available at SSRN: https://ssrn.com/abstract=2254419

Enrico Moretto (Contact Author)

University of Insubria - Department of Economics ( email )

Via Ravasi 2
Varese, 21100
Italy

CNR - IMATI ( email )

via Bassini 15
Milano, 20133
Italy

Stefano Rossi

Stockholm School of Economics

PO Box 6501
Stockholm, 11383
Sweden

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