M&A Essentials

Core motivations: scale, synergies, capability acquisition, vertical integration, geography, consolidation; buyer vs seller incentives; why deals fail; how to evaluate strategic fit in interview answers; identifying red flags in a deal rationale.

Purchase consideration (cash, stock, debt, mixed); sources & uses logic and funding constraints; basic deal terms (offer price, premium, cash vs stock elections); transaction fees; what bankers mean by pro forma; how structure choices change risk and outcomes.

Purchase accounting intuition: enterprise value to equity purchase price; net identifiable assets, write-ups, goodwill; intangible amortization basics; deferred tax impacts at a conceptual level; how acquisition accounting affects post-deal earnings and balance sheet; classic interview what happens to goodwill? questions.

What drives accretion/dilution without building a full merger model: relative P/E, financing mix, cost of debt, synergies, amortization, one-time costs; EPS math intuition; when an all-stock deal is accretive/dilutive; common interviewer follow-ups and clean ways to explain the outcome.