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Module 2 - Merger & Acquisition

1. There are two types of acquisitions: net asset acquisitions and stock acquisitions. In a net asset acquisition, the acquirer acquires 100% of the acquiree company's net assets. This can result in a gain or loss on bargain purchase. Issuance costs for stock or debt are treated as expenses. 2. In a stock acquisition, the acquirer obtains control of the acquiree by acquiring a majority of its voting equity shares. No gain or loss is recognized. The acquirer allocates the purchase price to the identifiable assets and liabilities acquired. 3. A parent-subsidiary relationship exists for stock acquisitions, where the parent company obtains control

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17 views

Module 2 - Merger & Acquisition

1. There are two types of acquisitions: net asset acquisitions and stock acquisitions. In a net asset acquisition, the acquirer acquires 100% of the acquiree company's net assets. This can result in a gain or loss on bargain purchase. Issuance costs for stock or debt are treated as expenses. 2. In a stock acquisition, the acquirer obtains control of the acquiree by acquiring a majority of its voting equity shares. No gain or loss is recognized. The acquirer allocates the purchase price to the identifiable assets and liabilities acquired. 3. A parent-subsidiary relationship exists for stock acquisitions, where the parent company obtains control

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karmaude
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© © All Rights Reserved
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Download as PDF, TXT or read online on Scribd
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2Typesof Acquisition

1NetAssetAcquisition
4 Acquirer acquires 100
oftheacquireecompany NETASSET

go.awinigitisirgi.IE
at
Gain
onbargainpurchase xx
Aramis
L II outrightexpense
can
I shareissuecost whennetassetsareacquiredthrough shares
ofstock
nmium ii
i in ii i Issuance
ofanyformof
indebtedness
indebtedness
3 Issuance
ofanyformoftreated
Bondissuecost similarlywithDiscountin BondsPayable deductionfromfaceofbonds
4
OutrightExpense 553,000

Consideration transferred 365,000

1
0
Consideration transferred

EE
I
1600,000

OE sp

150.0010
3

3000,000
s
4288
III a iii iii iii 4332,000
Consideration transferred 8.000,000

1.900.000
thinIbargainpurchase 45888
5.60.000

AQY.si
agiie to
h BargainPurinase

manner
Ordinarysharecapital ofacquisition
ShanPremium
4Acquirer
considerationtransferred 000

18 500 1437.500250k 500k

2StockAcquisition
Parenta subsidiary

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