Back to M&A questions
Calculate the implied premium paid. Unaffected share price = $50, offer price = $67.50.
Answer
Premium = ($67.50 / $50) − 1 = 35%.
Why interviewers ask this
Standard control premium calculation. Typical deal premiums run 20–40%; tech and biotech often see 50%+. Always measure premium vs. the unaffected share price (the price before rumors of a deal), not the day-before-announcement price.
premiummath