Credit Suisse Interview Question: If a company acquires another... | Glassdoor

Interview Question

Investment Banking Analyst Interview(Student Candidate)

If a company acquires another company with a lower P/E

  ratio, is the deal accretive or dilutive?
Answer

Interview Answer

3 Answers

8

Accretive

Anonymous on Nov 19, 2014
0

why

O on Apr 12, 2017
0

It depends, a low P/E ratio means the company being acquired has a higher yield. If the yield is higher than the acquirer's weighted cost of the purchase, the deal will be accretive and vice versa.

Anonymous on Apr 30, 2017

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