Select two public companies which have been in a takeover or merger transaction in recent years.

Question 1. Ratio analysis

Analyze the financial statements of these two companies in the year prior to the transaction, and the consolidated financial statements 1 year and 3 years after consolidation using:

(a) Calculation of ratios:

(i) 3 Profitability and solvency (liquidity) ratios.

(ii) 2 Efficiency ratios

(iii) 3 Shareholder ratios

(iv) 3 Capital structure ratio

(b) Critically interpret and discuss the ratios in point :

(i) to (iv) above 1 year before and 3 years after the takeover and merger transactions for point. Besides your qualitative explanations, use figures, tables and graphs to present your data.

(c) Compare the ratios of consolidated financial statements with two of the main competitors of the firm within the same industry and also with those of industry.

(d) Would you invest in the company after the transaction? How does the company compare to its competitors and the industry? Why or why not? Justify your answer by write short recommendation to a potential investor. Structure your writing properly