Eli Amir - Financial Analysis of Mergers and Acquisitions: Understanding Financial Statements and Accounting Rules with Case Studies

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This Palgrave Macmillan imprint is published by the registered company Springer Nature Switzerland AG

The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland

Most companies, over their life, go through business combinations and major restructurings. Surprisingly, while there are many handbooks on financial statement analysis, the effects of mergers and acquisitions and corporate restructurings on financial analysis is virtually ignored by most manuals.

This book fills a gap in the current knowledge on business combinations and is an essential reading for all those who intend to understand and analyze real financial statements.

Acquisitions and divestitures, spin-offs and equity carve-outs, leverage buyouts and recapitalizations are company-defining moments, and the accounting treatment of these deals, as well as the related corporate disclosures, call for detailed elucidation. As most publicly listed companies issue consolidated financial statements, it is very important to understand the financial consequences of M&A transactions and other major restructurings. M&A transactions clearly shock the consolidated balance sheet, income statement, and cash flow statement. Analyzing financial statements without reference to M&A transactions is incomplete at best. Understanding the accounting rules for inter-corporate investments in general and the rules for M&A transactions in particular, is, therefore, key to understanding the business and economics of the reporting company. All the more so in the presence of different types of deal structures managers put in place to achieve a specific corporate objective. Furthermore, as deal volume, both within and across borders, increase, accounting and reporting of M&A transactions become crucial in analyzing financial statements.

This book is a road map to successfully analyzing M&A transactions based on financial statements and digging into real-life landmark deals.

The reader stands to benefit from this book for many reasons. First, because of the invaluable experience the authors developed through many years in the M&A world, both in academia and in the advisory profession. Second, because of the authors ability to break down the major components of this subject into concrete steps, enabling the reader to walk through the varieties of accounting rules for M&A transactions using a detailed and comprehensive roadmap, enriched by many examples. The book is useful because it is a practical, hands-on, and a user-friendly guide rather than a general and theoretical essay. In addition, the real-life case studies provided in the second part of the book are truly gems that illustrate, step-by-step, all the different aspects behind the financial interpretation and reporting of M&A deals.