Valuing Dynamic Capabilities-Based Synergies with Real Options

Valuing M&A Synergies as (Fuzzy) Real Options

This paper views operating synergies as real options that acquiring companies have in the post-acquisition M&A process. The paper builds on the synergistic restructuring theory, which states that both acquisitions and divestitures are wealth-creating activities. Acquisition synergies are broadly defined as arising both from resource redeployments between the acquirer and the acquisition target ...

A Real Options-based Framework for Valuing

In recent years, considerable research has focused on understanding the value derived from market-based assets such as brands and consumer relationships with comparatively little attention being directed at business relationships. We address this gap in the literature by proposing a real options-based framework for valuing business relationships. The framework provides new insights into the rol...

Valuing flexibility in demand-side response: A real options approach

The investment interests in the electricity industry are transmitted through various mechanisms to other economic activities. This paper considers methods for esteeming the adaptability of demand-side response (DSR) in its capacity to react to future uncertainties. The capacity to evaluate this adaptability is particularly critical for vitality frameworks speculations given their extensive and ...

Valuing Real Options using Implied Binomial Trees

A real option on a commodity is valued using an implied binomial tree (IBT) calibrated using commodity futures options prices. Estimating an IBT in the absence of spot options (the norm for commodities) allows real option models to be calibrated for the first time to market-implied probability distributions for commodity prices. Also, the existence of long-dated futures options means that good ...

Valuing Real Options: Insight from Competitive Strategy