One PS for the less experienced on the strategy of M&A
Why would an acquiring company pay 10 to 15x EBITA as some might see this as expensive?....
But its not really the case! If the acquiring company is valued at 30x in their own right and they pay 15x for 1b in new profits then in fact once adding this new 1b profit to their own bottom line this grows their equity and shareholder value to an extra 30b... payback plus more happens as soon as the ink has dried on the signing contract... this is the pure basis on how money is made in M&A.
NEU management understand this so it will never be let go cheaply assuming the drug is approved and works.
Updated MST report - target of $3.68 a share, page-98
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$20.17 |
Change
0.070(0.35%) |
Mkt cap ! $2.578B | |||
| Open | High | Low | Value | Volume |
| $20.39 | $20.53 | $20.14 | $4.102M | 202.5K |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 2 | 249 | $20.15 |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| $20.31 | 790 | 1 |
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