Accretive Acquisition

Accretive Acquisition
An acquisition that will increase the acquiring company's earnings per share (EPS). These acquisitions tend to be favorable for the company's market price because the price paid by the acquiring firm is lower than the boost the new acquisition will provide to the acquiring company's EPS. 

As a general rule, an accretive merger or acquisition occurs when the price-earnings (P/E) ratio of the acquiring firm is greater than that of the target firm.


Investment dictionary. . 2012.

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  • Dilutive Acquisition — A takeover transaction that will decrease the acquirer s earnings per share (EPS) if additional shares are issued to pay for the acquisition. Dilutive acquisitions decrease shareholder value and should thus be avoided, unless the strategic value… …   Investment dictionary

  • Accretion (finance) — In finance, accretion is the change in the price of a bond bought at a discount to the par value of the bond [ [http://financial dictionary.thefreedictionary.com/accretion Accretion definition on the financial dictionary] ] .Accretion, in a… …   Wikipedia

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