Calculate the pro forma EBITDA estimates

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Question - Two companies are considering the acquisition of Target Company. Buyer A is a strategic buyer and Buyer B is a financial buyer. The following information pertains to Target Company:

- Sales £ 28,000,000

- Reported EBITDA £ 4,500,000

- Reported executive compensation £ 1,000,000

- Normalized executive compensation £ 500,000

- Reduced SG& A from eliminating duplicate general and administrative functions £ 600,000

Calculate the pro forma EBITDA estimates that the strategic and financial buyers would each develop in an acquisitions analysis of Target Company.

Reference no: EM132984977

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