5. Post-merger cash flows and bidding Aa Aa In a merger analysis, the most important part of the analysis is to determine whether there are any operating synergies between the merging companies. This step is critical in the process of estimating post-merger cash flows and the value that the merger will bring to the firms. A merger in which the incremental post-merger cash flows are simply the target firm's expected cash flows is called Consider the case of LetsMerge Co. and WhoMe Inc.: LetsMerge is targeting WhoMe for a potential friendly merger. After initial discussions with the management of WhoMe, LetsMerge sends a team of analysts, engineers, and advisers to evaluate expected synergistic benefits and to estimate the value of operations of WhoMe. This process is called due diligence. The due diligence team submits a report stating that WhoMe's current market value of equity is $36.00 million. Based on projected cash flows in the pro-forma statements, analysts calculate that the post-merger value of operations will continue to be $36.00 million. Are any synergistic benefits expected from the merger? O No O Yes