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- March 6, 2020 at 5:07 pm #564637
I got WACC 8.08% which I rounded down to 8%
Did you get a positive gain for shareholders of bidding company? For me it was a high negative number I don’t know if there was something wrong in the question. The 6% profit margin on revenue seemed suspiciously low.
Sale value for the Tech Part was 5,504 million and Present value of Cash flows to firm was around 18,000 million, then I used the Debt Equity proportions at market value to calculate Value of Equity post acquisition which came out to be less than the whole bid amount already so I got a negative value there and from that were supposed to deduct the pre-acquisition value of the bidding company which would only make the negative number bigger.March 6, 2020 at 4:22 pm #564629Did anyone else get negative gain/ loss for shareholders in the first question?
Sale value for the Tech Part was 5,504 million and Present value of Cash flows to firm was around 18,000 million, then I used the Debt Equity proportions at market value to calculate Value of Equity post acquisition which came out to be less than the whole bid amount already so I got a negative value there and from that were supposed to deduct the pre-acquisition value of the bidding company which would only make the negative number bigger.
Am I wrong somewhere? Couldn’t frame the report based on this - AuthorPosts