CFA Practice Question

There are 86 practice questions for this study session.

CFA Practice Question

If a merger is financed by cash, this implies:

I. The acquirer's gain may evaporate if the realized synergies are less than expected after the merger.
II. The target's gain may evaporate if the realized synergies are more than expected after the merger.
III. The acquirer's gain will increase if the realized synergies are more than expected after the merger.
Correct Answer: I and III

II: The takeover premium for the target would remain unchanged no matter what happens to the realized synergies.

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