The issue is being careful about distinguishing between Equity Value and Enterprise Value.
Equity value (in this case) is the sum of market cap prior to the placement (takeover) plus implied value of equity offered to purchaser. As per Tawny's post. What is the company worth in the hands of the shareholders to the shareholders.
Enterprise Value is gross market cap plus debt minus cash - what a purchaser would have to shell out if buying 100% of the company - as per Danube.
Different answers for different questions.
In other situations, the cash needs to be considered slightly differently (a la the RSL thread some month or so ago), but this is a classic, traditional case.
f111
The issue is being careful about distinguishing between Equity...
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4.6¢ |
Change
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Mkt cap ! $31.80M | |||
| Open | High | Low | Value | Volume |
| 0.0¢ | 0.0¢ | 0.0¢ | $0 | 0 |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 1 | 175000 | 4.0¢ |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| 5.2¢ | 30000 | 1 |
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