What considerations would you have when evaluating a potential acquisition for a client? So if I was to evaluate a potential acquisition for a client, my starting point would be to look at the deal benefits and the cost of the deal. So one of the main benefits that comes from deals are from synergies. That's to say the cost savings that come from combining two businesses together.

I know that synergies can be quite tricky to calculate, but from what I've read, some of the greatest synergies comes from companies with a similar geography or a good strategic and cultural fit. So my starting point to evaluating the deal benefits would be to look at the strategic and the cultural fit of my client and the target, and then to look at the cost of the deal. I would look at the value of other similar companies within the industry with a particular focus on any recent M&A deal within the industry. Something to be aware of is the acquisition premium can be impacted by factors like a really large stakeholder or having lots of bidders trying to acquire the same target. So once I've estimated my deal benefits and my cost of the deal, I think it would be really worthwhile to evaluate how the deal is financed as this can have an impact on value creation. Debt financing is cheaper and more tax efficient approach to financing a deal. However, there's a limit to how much debt a company can take on. So in larger acquisitions, equity financing might be a more viable option, but only if the client is already publicly listed. - This is a wide open question with lots of potential to answer it how you want. The interviewee has gone down a quantitative route. The value of synergy benefits, the cost of buying the company, and potential financing. A great answer that's focused on the numerical aspects of the deal. It's much easier to talk about the qualitative aspects of the deal, cultural fit, product fit, geographical fit, strategy, et cetera. But anyone could give that kind of answer without doing any research at all. Being able to talk about acquisition costs, financing, the debt is cheaper, but limited and how much company can take on, it shows a strong understanding of finance. Other quantitative answers you could have used include dilution of ownership, which means by offering to pay with shares, the acquirer gives up some of their ownership and the effect on the acquirer's credit rating from taking on more debt.