- CFA Exams
- 2022 Level II
- Study Session 8. Corporate Finance (2)
- Reading 23. Mergers and Acquisitions
Why should I choose AnalystNotes?
Simply put: AnalystNotes offers the best value and the best product available to help you pass your exams.
Learning Outcome Statements PDF Download
1. Definitions and classifications a. classify merger and acquisition (M&A) activities based on forms of integration and relatedness of business activities; | |
2. Motives for merger b. explain common motivations behind M&A activity; c. explain bootstrapping of earnings per share (EPS) and calculate a company's postmerger EPS; | |
3. Mergers and industry life cycle d. explain, based on industry life cycles, the relation between merger motivations and types of mergers; | |
4. Transaction characteristics e. contrast merger transaction characteristics by form of acquisition, method of payment, and attitude of target management; | |
5. Takeovers f. distinguish among pre-offer and post-offer takeover defense mechanisms; | |
6. Regulation g. calculate and interpret the Herfindahl-Hirschman Index and evaluate the likelihood of an antitrust challenge for a given business combination; | |
7. Target company valuation h. compare the discounted cash flow, comparable company, and comparable transaction analyses for valuing a target company, including the advantages and disadvantages of each; i. calculate free cash flows for a target company and estimate the company's intrinsic value based on discounted cash flow analysis; j. estimate the value of a target company using comparable company and comparable transaction analyses; | |
8. Bid evaluation k. evaluate a takeover bid and calculate the estimated post-acquisition value of an acquirer and the gains accrued to the target shareholders versus the acquirer shareholders; l. explain how price and payment method affect the distribution of risks and benefits in M&A transactions; | |
9. Who benefits from mergers? m. describe characteristics of M&A transactions that create value; | |
10. Corporate restructuring n. distinguish among equity carve-outs, spin-offs, split-offs, and liquidation; o. explain common reasons for restructuring. |

I am using your study notes and I know of at least 5 other friends of mine who used it and passed the exam last Dec. Keep up your great work!

Barnes
My Own Flashcard
No flashcard found. Add a private flashcard for the reading.
Add