To Value, Structure, and Negotiate Mergers and Acquisitions
There are two kinds of forecasters: the ones who don't know and the ones who don't know they don't know.
—John Kenneth Galbraith
Personal computer printer behemoth Hewlett-Packard (HP), had just announced its agreement to buy Electronic Data Systems (EDS) on May 9, 2008, for $13.9 billion (including assumed debt of $700 million) in an all-cash deal. The purchase price represented a 33% premium for EDS, a systems integration, consulting, and services firm. Expressing their dismay, investors drove HP's share price down by 11% in a single day following the announcement. ...