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On July 6, 2008, Fresenius Kabi AG signed a definitive agreement to acquire APP Pharmaceuticals Inc from American BioScience Inc for $4.7 billion in cash
On July 6, 2008, Fresenius Kabi AG signed a definitive agreement to acquire APP Pharmaceuticals Inc from American BioScience Inc for $4.7 billion in cash and an earnout of up to $970 million. The earnout would be calculated as 2.5 times the difference between cumulative EBITDA for the 2008-2010 fiscal years and $1.2677 billion.
Suppose that APP's EBITDA in 2008-2010 is $286.1, $336.2, and $454.3 million. What is the value of the earnout payment?
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