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Merger Model Sample BIWS JobSearchDigest

This document provides a sample merger model for Intel Corporation's acquisition of McAfee, Inc. It includes transaction assumptions such as purchase price, premium, and consideration mix. It also provides pre-merger financial profiles for Intel and McAfee. The model then shows projected post-merger income statements to calculate accretion/dilution from the deal.

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CCerberus24
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484 views

Merger Model Sample BIWS JobSearchDigest

This document provides a sample merger model for Intel Corporation's acquisition of McAfee, Inc. It includes transaction assumptions such as purchase price, premium, and consideration mix. It also provides pre-merger financial profiles for Intel and McAfee. The model then shows projected post-merger income statements to calculate accretion/dilution from the deal.

Uploaded by

CCerberus24
Copyright
© © All Rights Reserved
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Merger Model

This sample model is provided compliments of Breaking Into Wall Street and JobSearchDige

If you feel you need to further develop your modeling skills, you might consider the complete
Breaking Into Wall Street Financial Modeling Course

The full course includes:


* Over 60 hours of video training.
* Completely online and self paced modules.
* Excel tutorials covering: Accounting, Valuation, and Merger/LBO Modeling.
* Advanced Modeling covers topics such as: book vs. cash taxes, Section 382 NOLs,
and LBO with 7 debt tranches and 5 transaction scenarios.
* And you get FREE lifetime updates and support!

Here's to improving your financial skills!

David Kochanek
Publisher, JobSearchDigest.com
Street and JobSearchDigest.com

ght consider the complete

tion 382 NOLs,


Get the Entire Breaking Into Wall Street Financial Modeling Course
Merger Model - Intel Corporation and McAfee, Inc.
($ in Millions Except Per Share Amounts)

Transaction Assumptions

Buyer Name: Intel Corporation Seller Name: McAfee, Inc.


Announcement Date: 8/19/2010 Premium to Seller's Share Price:
Assumed Close Date: 12/31/2010 Per Share Purchase Price:
Purchase Price:

% Cash: 33.3% Cash Used:


% Debt: 33.3% Debt Issued:
% Stock: 33.3% New Shares Issued:
Foregone Cash Interest Rate: 4.0% Debt Interest Rate:

Intel Corporation - Financial Profile Prior to Merger McAfee, Inc. - Financial Profile Prior to Merger

Share Price: $19.59 Share Price:


Shares Outstanding (MM): 5,711.0 Shares Outstanding (MM):
Market Cap: $111,878 Market Cap:
Effective Tax Rate: 31% Effective Tax Rate:

Buyer - Income Statement Seller - Income Statement

Projected Years Projected Years


12/31/2011 12/31/2012 12/31/2011
Revenue: $47,450 $48,667 Revenue: $2,205
Cost of Goods Sold: $16,331 $17,995 Cost of Goods Sold: $496
Gross Profit: $31,119 $30,672 Gross Profit: $1,709

Operating Expenses: $13,000 $13,100 Operating Expenses: $1,131

Operating Income: $18,119 $17,572 Operating Income: $578


Interest Income / (Expense $150 $200 Interest Income / (Expense $5
Pre-Tax Income: $18,269 $17,772 Pre-Tax Income: $583
Income Taxes: $5,663 $5,509 Income Taxes: $140

Net Income: $12,606 $12,263 Net Income: $443

Earnings Per Share (EPS): $2.18 $2.10 Earnings Per Share (EPS): $2.88
Shares Outstanding: 5,786.0 5,832.0 Shares Outstanding: 154.0

Combined Income Statement, Post-Merger

Projected Years
12/31/2011 12/31/2012
Combined Revenue: $49,655 $51,048
Cost of Goods Sold: $16,827 $18,531
Gross Profit: $32,828 $32,518

Operating Expenses: $14,131 $14,322

Operating Income: $18,697 $18,196


Interest Income / (Expens $155 $205
Foregone Interest on Cash ($101) ($101)
Interest Paid on New Debt ($228) ($228)
Pre-Tax Income: $18,523 $18,072
Income Tax Provision: $5,742 $5,602

Net Income: $12,781 $12,469

Earnings Per Share (EPS): $2.16 $2.09


Shares Outstanding: 5,915.3 5,961.3

Accretion / Dilution: ($0.02) ($0.01)


Accretion / Dilution %: (0.8%) (0.5%)
deling Course

McAfee, Inc.
60.4%
$48.00
$7,600

$2,533
$2,533
129.3
9.0%

rofile Prior to Merger

$29.93
158.3
$4,739
24%

Projected Years
12/31/2012
$2,381
$536
$1,846

$1,222

$624
$5
$629
$151

$478

$3.10
154.0
Get the Entire Breaking Into Wall Street Financial Modeling Course

Company Filings:

Intel 10-Q

McAfee 10-Q

Share Price Information from Google Finance:

McAfee, Inc

Intel Corporation, Inc.

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