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In acquisition question NORMALLY, do acquirer always have to pay the debt holders (Vd) and to shareholders (Ve).
or otherwise, in what cases we will do this ?
-Payment to shareholders( Ve+premium) Plus
-Payment to bondholders (Vd)It depends on the question as to whether they are paying off the debt or whether they are taking over the debt. Usually they are taking over the debt.
If they are paying the debt then the payment will be the market value of the debt (unless told otherwise).
As regards paying the equity, it will be the market value of the debt subject to any premium payables as per the question.
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