Mergers, Acquisitions & Divestments Deep Dive
Get all the data on a company's acquisitions to assist with modeling and due diligence
Last updated: 20 September 2025
Objective:
This prompt identifies and reports each major M&A transaction undertaken by a company over a period specified by the user. It reports dates, a profile and rationale for each acquisition or divestment, disclosed financial metrics, post announcement share price performance, mix of financing and estimates of organic vs acquired revenue growth over the total period.
Explanation:
Investors run this analysis to see how a company really grows and allocates capital. A clean map of acquisitions and divestments over the last five years (or a user-set window) reveals strategy in action - what markets management is buying into or exiting, how much they pay, how they finance it, and whether promised synergies show up. The output returns a source-verified deal log with dates, target descriptions, geography, disclosed revenue/earnings, consideration and financing mix, any equity raise, and implied EV/Revenue and EV/EBITDA multiples. It also tracks the stock’s 1- and 3-month post-announcement performance versus a benchmark to gauge market validation. Finally, it extracts reported revenues over X years and decomposes cumulative growth into acquired versus organic, after adjusting for divestments - quantifying growth quality, not just quantity. The result is a fast, auditable view of capital allocation discipline, integration risk, and valuation paid for growth.
As always, be aware that models can make mistakes. At each step, examine the response and challenge information or conclusions that appear erroneous before proceeding to any subsequent steps. If in doubt use a second model with the same prompt to verify the information and generate challenge questions and answers (CoVe process) to correct interpretations of data.
Link to blog post explanation:
N/A
Preferred Model(s):
Gemini 2.5 PRO over ChatGPT 5+
Runtime: ~1-3 minutes (Gemini faster)
Important Execution Notes:
Insert Ticker and Company name (and exchange outside US) where indicated in Inputs section
Look-back period defaults to 5 years but can be user specified
Revenue extraction period is set to same default but can be varied by user.
Sample Output:
Copy/Paste Prompt Set:
Important note: Subscribers can use this prompt set for their own analysis. However, the prompt is copyrighted by The Inferential Investor, paywalled, and must not be shared without permission.
Role: You are an equity analyst.
Goal: Build a complete, source-verified history of all acquisitions and divestments for a listed company over a user-specified look-back (default 5 years), extract deal fundamentals, quantify implied multiples, track post-announcement share-price performance (1M/3M), and decompose reported revenue growth into acquired vs organic over the last X fiscal years.
________________________________________
1) Inputs (ask first; apply defaults if not given)
• Company: <INSERT TICKER + COMPANY NAME>
• Look-back window: <Y years> (default 5) from today or a specified cut-off date.
• Revenue years window X: <X> fiscal years to extract (default: align to the latest Y+1 fiscal years, e.g., base year = FY(t-X), end year = latest completed FY).
• Reporting currency: default to company reporting currency; if targets disclose in other currencies, convert using FX at announcement date (or specify chosen convention).
• Benchmark index for SP performance: default to company’s primary listing index (e.g., S&P 500, ASX 200).
• Return type: total return if available, else price-only (state which).
________________________________________
2) Sources & Evidence Rules
• Primary sources first: company press releases, 8-K/6-K/ASX announcements, 10-K/20-F/10-Q/MD&A, merger proxy/circular, investor decks, transcripts, target filings.
• Secondary checks: reputable newswires (e.g., Reuters, Bloomberg), data rooms, refinitiv/factset summaries for cross-checks.
• Citations: For every number or date, give source name + document type + date + page/section (or press-release timestamp) and a link. Note if a figure is management-stated, pro forma, LTM, or estimated.
________________________________________
3) What to Extract for Each Acquisition/Divestment
Create one row per transaction and a short “deal card.” Capture:
1. Deal basics
• Type: Acquisition / Divestment
• Counterparty/Target (or Segment divested)
• Announce date; Close/Completion date (note if pending)
• Concise description: what the business does (1–2 lines, plain English)
• Geographic exposure (by country/region % if disclosed; else qualitative)
2. Rationale (management’s words)
• 1–3 bullets quoting or paraphrasing the rationale from press releases or briefings (synergies, product gaps, geography, tech, regulatory, capital recycling). Include exact quote + source/date where meaningful.
3. Financials disclosed
• Revenue of target/segment (state basis: LTM, FY-YYYY, run-rate, pro forma).
• Earnings metric if given (EBITDA/Operating income/Net).
• Margins if disclosed.
• Any synergy guidance (cost/revenue), with timing.
• For divestments: revenue/earnings of the disposed unit (same basis).
4. Consideration & Financing
• Headline “deal value” (specify Equity Value vs Enterprise Value; include earn-outs/contingent payments if stated).
• Price paid/received and mix (cash, stock, assumed debt, earn-outs).
• Financing mix: cash on hand, new debt (size/tenor/rate if given), new equity issued (shares/price/gross proceeds).
• Equity raise summary if associated (date, size, instrument, pricing, fees if disclosed).
5. Implied multiples (state method)
• EV/Revenue and, where possible, EV/EBITDA (or EV/OpInc).
o If only Equity Value is given, derive EV = Equity Value + Net Debt + NCI – Cash (target basis).
o Align numerator/denominator time bases (e.g., EV vs LTM revenue at or near close).
6. Share-price performance (for acquirer)
• Compute +1 month and +3 months total return from the announcement date (if announced after market close, use next trading day as t₀).
• Also compute excess return vs benchmark over same windows.
7. Regulatory/closing notes
• Key approvals/conditions, termination fees, delays, withdrawn/renegotiated terms (if any).
________________________________________
4) Output — Tables & Artifacts (produce all)
A) Master Transactions Table (one row per deal)
Columns:
[Deal_ID] [Type] [Announce_Date] [Close_Date] [Target_or_Segment] [Business_Summary_≤140c] [Geo_Exposure] [Target_Revenue_(basis/year/currency)] [Target_Earnings_(metric/basis)] [Deal_Value_(EV/Equity)] [Consideration_Mix] [Financing_(Debt/Equity/Other)] [Equity_Raise_Summary] [EV/Revenue_(x)] [EV/EBITDA_(x)] [Acquirer_1M_TR_%] [Acquirer_3M_TR_%] [Excess_1M_%] [Excess_3M_%] [Primary_Sources]
B) Deal Cards (bullet mini-memos)
• 5–8 bullets summarizing the fields above plus quoted rationale.
C) Equity Raise Summary Table (if any)
[Date] [Instrument] [Shares/Units] [Offer_Price] [Gross_Proceeds] [Use_of_Proceeds] [Fees_if_disclosed] [Source]
D) Revenue Extraction Table (Company, last X FYs)
[FY] [Reported_Revenue] [Constant-FX_Revenue_if disclosed] [Notes/Source]
E) Organic vs Acquired Revenue Decomposition
Provide a small methodology box and the calculations (see §5). Output:
[Base_FY] [End_FY] [Reported_Revenue_Base] [Reported_Revenue_End] [Cumulative_Revenue_Growth_(End–Base)] [Estimated_Acquired_Revenue_Contribution] [Estimated_Organic_Revenue_Growth] [Acquired_Share_%] [Organic_Share_%] [Key_Assumptions]
F) Charts (optional but recommended)
• Timeline of deals with icons for A/D and bubble size = deal value.
• Bar chart: Acquired vs Organic contributions to cumulative revenue growth.
• Event study lines: acquirer 1M/3M returns vs benchmark.
________________________________________
5) Calculations & Estimation Conventions (be explicit)
5.1 Share-price performance
• Return₁M = (Pₜ₊₂₁ / Pₜ₀ − 1) (21 trading days).
• Return₃M = (Pₜ₊₆₃ / Pₜ₀ − 1).
• Excess = Return − Benchmark Return over same window.
• Use total return series if available; else price-only (flag it).
5.2 Implied multiples
• Prefer EV and LTM financials nearest to close. If only announcement-date numbers exist, say so.
• If only revenue given, compute EV/Revenue; if EBITDA/OpInc is available, compute EV/EBITDA/EV/OpInc.
• For divestments, use EV/Rev and EV/EBITDA on the sold unit if disclosed.
5.3 Revenue decomposition (Acquired vs Organic) over last X FYs
Define:
• Base year = FY(t−X); End year = latest completed FY.
• Cumulative reported growth = Reported_Revenue_End − Reported_Revenue_Base.
Estimate Acquired contribution using this hierarchy (use the highest-quality available; cite choice):
1. Management disclosure of “acquisition contribution” to revenue (per FY). Sum across years.
2. If absent, Run-rate approximation: sum target LTM revenue at close for all acquisitions that were not part of base year and are still consolidated by end year. Adjust if a deal closed part-way through End FY and management gives a full-year run-rate.
3. Adjust for divestments: subtract LTM revenue of disposed units that existed in the base year (this keeps the split about growth from M&A vs underlying operations).
4. FX & pro-forma: if large FX swings or pro-forma restatements exist, note a constant-currency cross-check and bound estimates as Low/High using disclosed ranges.
Then compute:
• Acquired_Growth ≈ (Σ LTM_Acq_Revenue contributing by End FY) − (Σ LTM_Divest_Revenue present in Base FY).
• Organic_Growth = Cumulative_Reported_Growth − Acquired_Growth (floor at 0 if negative; discuss why).
• Shares: Acquired_Share_% = Acquired_Growth / Cumulative_Reported_Growth and Organic_Share_% = 1 − Acquired_Share_%.
• Include assumption notes (e.g., retention/attrition, integration timing, discontinued operations).
________________________________________
6) Method & QA Checklist
• Completeness: Cross-check press release archive vs filings “Acquisitions and Dispositions” notes.
• Dates: Watch announce vs close; pending/terminated deals labeled clearly.
• Units & FX: State currency for each figure; convert when consolidating.
• Consistency: Same basis for multiples (EV vs LTM), same window for returns.
• One-offs: Flag earn-outs, contingent consideration, unusual purchase price allocations, impairment soon after close.
• Reconciliation: Sum of target revenues vs management’s disclosed “acquisition contribution” (explain gaps).
• Divestment treatment: Ensure disposed revenue doesn’t inflate “organic growth” — apply the adjustment noted in §5.3.
• Citations: Every figure/date has a verifiable source (doc + page/section + date).
________________________________________
7) Deliverable Structure (final report)
1. Executive Summary (8–10 bullets): what the company bought/sold, why, total spend/proceeds, median multiples, post-deal stock reaction patterns, and headline Acquired vs Organic split over X years.
2. Master Transactions Table (sortable) + Deal Cards.
3. Equity Raise Summary (if any).
4. Revenue & Decomposition Tables + chart.
5. Methodology & Assumptions (one page).
6. Bibliography of Sources with links and access dates.
________________________________________
8) Output Format (ready to copy to Excel/CSV & report)
• Provide the Master Transactions Table as a CSV block and a rendered table.
• Provide the Revenue & Decomposition Table likewise.
• Place quotes for rationale in quotation marks with source lines.
• End with a short Analyst Commentary (what patterns and risks jump out).
________________________________________
9) Edge Cases & Fallbacks
• No disclosure of target revenue/earnings: estimate from segment splits, prior press, or local registries; label Estimated and give range.
• Bundle deals / multi-target roll-ups: break out per target if possible; else present a composite row and explain.
• Terminated deals: keep in table with Status = terminated; price/multiples N/A.
• SPAC/Reverse mergers: treat as acquisition; state structure explicitly.
• Private targets with scant data: prioritize EV/Revenue from credible press if filings absent; give confidence flag.
________________________________________
(Optional) Minimal Column Schema for CSV (paste at top of your sheet)
Deal_ID,Type,Announce_Date,Close_Date,Target_or_Segment,Business_Summary,Geo_Exposure,Target_Revenue_Basis,Target_Revenue_Value,Target_Revenue_Currency,Target_Earnings_Metric,Target_Earnings_Value,Deal_Value_Type,Deal_Value,Consideration_Mix,Financing_Detail,Equity_Raise,EV_to_Revenue,EV_to_EBITDA,Acquirer_1M_TR_pct,Acquirer_3M_TR_pct,Excess_1M_pct,Excess_3M_pct,Primary_Sources
________________________________________
Instruction to self when running this prompt: If the user does not specify Y and X, default Y = 5 years and set X to cover Base FY = (latest completed FY – 5) through End FY = latest completed FY. Clearly label all assumptions and conversion conventions.