Displaying risk in mergers: a diagrammatic approach for exchange ratio determination

Alessandra Mainini, Enrico Moretto and Daniela Visetti

No 529, Working Papers from University of Milano-Bicocca, Department of Economics

Abstract: This article extends, in a stochastic setting, previous results in the determination of feasible exchange ratios for merging companies. A first outcome is that shareholders of the companies involved in the merging process face both an upper and a lower bounds for acceptable exchange ratios. Secondly, in order for the improved ‘bargaining region’ to be intelligibly displayed, the diagrammatic approach developed by Kulpa is exploited.

Keywords: Mergers and acquisitions; exchange ratio determination; synergy; risk-adjusted performance; diagrammatic representation (search for similar items in EconPapers)
Pages: 25
Date: 2024-01
New Economics Papers: this item is included in nep-cfn
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Working Paper: Displaying risk in mergers: a diagrammatic approach for exchange ratio determination (2024)
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