Goodwill

Topics related to standalone valuation including fundamental valuation, relative valuation, sum-of-parts and other techniques.

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Goodwill

Postby private equity » Sat Apr 09, 2011 3:01 am

Hi WST,
Quick Question: should option proceeds be deducted from purchase price to calculate the goodwill?
Many thanks.
private equity
 
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Re: Goodwill

Postby wsthost » Sun Apr 10, 2011 10:30 am

We generally use the treasury method to calculate fully diluted transaction equity value.
SInce that includes the proceeds after receiving option exercise $, but on a "cash-less" basis, the answer is yes.
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