How to Make a Good Deal in a Merger

Dilution is usually calculated on a pro form basis for both book value and current earnings per share. When our calculation is negative, diluted from the acquiring company's standpoint, justifying explanation will be made internally if not elsewhere. What really counts is whether a merger is diluted or anti-deluded in terms of intrinsic business value. If corporate pregnancy is going to be the consequence of corporate mating, the time to face that fact is before the moment of ecstasy.