Enterprise & Equity Value
In a 'cash-free, debt-free' transaction, what does the seller keep, and how does that reconcile to the EV bridge?
Model answer
In a cash-free, debt-free (CFDF) deal, the parties agree a purchase price on an enterprise value basis; the seller keeps the company's cash and is responsible for paying off its debt at close (the…
The full, human-reviewed answer is in the bank.
Sign up free and Daily 10 serves you 10 questions a day from all 1,500+ — or go Pro for unlimited reps.
More from Enterprise & Equity Value
- What's the difference between enterprise value and equity value?
- Why do you subtract cash when going from equity value to enterprise value?
- Why is enterprise value capital-structure neutral but equity value is not?
- A company issues $100 of new debt and holds the cash on its balance sheet. What happens to EV and equity value?
- Which valuation multiples pair with enterprise value vs. equity value, and why?
- How do you calculate fully diluted shares?