Reply To: Acquisition at a premium


Dmitry Govorov

Premium is in the eyes of the buyer – it’s up to his vision – whether realistic or not – what value he can extract from the target. I reckon in many cases realized acquisition value can be seen through a longer term horizon, or via ‘strategic’ rationale. That’s why the price paid should be quite below the value to the buyer, to account for possible downward ‘adjustment’ in aspirational assumptions.

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