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Sir
1) can you explain me what kind of benefit a company would receive from acquiring an under valued company???
2) And how acquiring an under valued company would offer tax saving to acquiring company???
(I couldn’t find a proper explanation anywhere to understand)
1. If the company is undervalued then it means the share price is lower than it should be for the potential future earnings. Therefore if the acquiring company is able to buy it for less than it is really worth, they will gain in the future.
2. There is no particular reason why there should be a tax saving.
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