question archive A company PT A (Tbk) as a target will be acquired by another company, namely PT B (Tbk) as the holding company
Subject:AccountingPrice: Bought3
A company PT A (Tbk) as a target will be acquired by another company, namely PT B (Tbk) as the holding company. The information of the two companies after the acquisition is as follows :
PT A (Tbk) |
PT B (Tbk) |
|
FCF (Rp miliar) |
15 |
6 |
WACC (%) |
9% |
5% |
Growth (%) |
3% |
5% |
Share price (Rp) |
20.000 |
10.000 |
Shares outstanding (lembar) |
8.000.000 |
1.000.000 |
a. You as a corporate finance consultant, try to calculate the synergies resulting from the acquisition, assuming that: (i) the sales value of the two companies is the same as the market value and (ii) both companies have stable growth in perpetuity.
b. Why is a large company with slow growth being the target of another company to acquire?