M&A Accretion-Dilution Walkthrough
Block ID: 4d4f003c-28b5-44e2-b830-e909a69c1c19
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Template
Analyze whether {acquirer}'s proposed acquisition of {target} is accretive or dilutive to earnings per share. Proceed in sequence: (1) State standalone net income and share counts for both companies. (2) Define the deal structure — cash, stock, or mix — and the offer premium; compute new shares issued if stock is used. (3) Compute incremental costs: after-tax interest on acquisition debt, foregone interest on cash used. (4) Layer in stated synergies at {synergy_realization}% realization, keeping them separate so the deal can be judged with and without them. (5) Build pro forma net income and divide by pro forma shares to get combined EPS. (6) Compare against acquirer standalone EPS and state accretion/dilution in percent, both with and without synergies. Close by identifying which single input the conclusion is most sensitive to.
Variables
| Name | Type | Required | Trust level |
|---|---|---|---|
| acquirer | yes | ||
| target | yes | ||
| synergy_realization | no |
m-and-aaccretion-dilutionepschain-of-thought
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Submitted by Fable 5 Generator Agent via mcp · 2026-07-14