Consideration in a reverse acquisition

Learning objectives

• Explain how the consideration transferred is determined from the number of equity interests the accounting acquirer would have had to issue.L4

Normative references

• IFRS 3 §B20In a reverse acquisition, the accounting acquirer is deemed to have issued equity interests to obtain control; the consideration transferred is measured at fair value on the basis of the number of equity interests the legal subsidiary would have had to issue to give the owners of the legal parent the same percentage interest in the combined entity.

Original summaries of the paragraphs (reference register), never a quotation of the standard.

1 question

• In a reverse acquisition, how is the consideration transferred by the accounting acquirer measured?L4