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EV Exercise

Market capitalization is calculated as the share price multiplied by the number of shares outstanding. Enterprise value adds net debt to market capitalization. For ABC Inc: - Market capitalization is $5,125 million based on a share price of $10.79 and 475 million shares outstanding. - Enterprise value is $5,925 million, which adds net debt of $800 million to the market capitalization. For Geoffreys plc: - Fully diluted shares outstanding are 156.68 million, which includes the impact of options, convertible debt, and convertible preferred shares. - Market capitalization based on the fully diluted shares is £13,415.08 million at a

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296 views

EV Exercise

Market capitalization is calculated as the share price multiplied by the number of shares outstanding. Enterprise value adds net debt to market capitalization. For ABC Inc: - Market capitalization is $5,125 million based on a share price of $10.79 and 475 million shares outstanding. - Enterprise value is $5,925 million, which adds net debt of $800 million to the market capitalization. For Geoffreys plc: - Fully diluted shares outstanding are 156.68 million, which includes the impact of options, convertible debt, and convertible preferred shares. - Market capitalization based on the fully diluted shares is £13,415.08 million at a

Uploaded by

Ashish Singhal
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Que 1 - Calculate Market capitalization and Enterprise Value for ABC Inc.

under both cases using the following i


Current Share price (in USD)
Class A
Class B
Latest Shares issued (in mn)
Class A (including treasury stock 25 mn)
Class B
6% Senior debentures (USD mn)
Minority interest (USD mn)
Cash and equivalents (USD mn)

Total Shares outstanding


Share price
Market Capitalization
Enterprise Value

12.50
Not Listed
350
150
1,200
250
400

(in mn, except per share data)


475
12.50
5,938
6,988

Que 2 - Calculate the EV of the company along with the trading multiples
(All figures are in GBP mn, except per share data)
Share price (in GBP)
Shares issued

20.00
65

Shareholders equity
Paid up capital
Treasury stock
Reserve and Surplus
Minority interest
Total shareholders equity

180
(10)
380
50
600

Short-term debt
Long-term debt
Cash & cash equivalents

250
400
300

The company has GBP 20 mn of restricted cash against debt, which is included in cash and cash equivalents
The company has a treasury stock of 5 mn shares
Market Cap
EV
EV
EV
EV

1,200
1,600 If
1,580 If
1,620 If
1,600 If

restricted
restricted
restricted
restricted

cash
cash
cash
cash

is
is
is
is

against debt and alre


against debt and not
not against debt and
not against debt and

Que 3 - Use the following information, calculate Market Capitalization of Geoffreys plc. Use treasury method to
(Figures reported are in absolute numbers)
Shares outstanding
Share price (GBp)

153,658,924
85.62

Options outstanding
Exercise price (GBp)
Options Exercisable
Exercise price (GBp)
3.5% Convertible Notes
Conversion price
5% Convertible Series A, 1000000 Preferred Shares (Lis
Conversion price
5% Convertible Series A Preferred: Price

Total options
Cash from exercise of options
Shares repurchased
Dilution Impact of Options
Dilution Impact of Convertible Debt
Dilution Impact of Convertible Preferred
Total Diluted number of shares Outstanding
Market Capitalization

9,652,736
75.44
3,524,884
69.57
1,500,000
0.80
850,000
0.90
0.82
(in mn)
9.65
728.20
8.51
1.15
1.88
out of money
156.68
13,415.08

es using the following information:

s
s
s
s

Current Share price (in USD)


Class A
Class B
Latest
Shares
issued (in
mn) stock
Class
B (including
treasury
25 mn)
Class A
6% Senior debentures (USD mn)
Cash and equivalents (USD mn)
Net debt

12.50
3.95
10.00 6.842105
350
150
1,200
400
800

(in mn, except per share data)


Shares outstanding
475
Share price
10.79
Market Capitalization
5,125
Enterprise Value
5,925

0.684211
0.32

10.75

cash equivalents

against debt and already included in Cash and Cash Equivalents


against debt and not included in Cash and Cash Equivalents (separately reported / part of other assets)
not against debt and already included in Cash and Cash Equivalents
not against debt and not included in Cash and Cash Equivalents (separately reported / part of other assets)

se treasury method to calculate the impact of options

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