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A software company Crowd strike (CRWD) is planning to acquire another software company Firewall. The market cap for CRWD is $30 billion. CRWD does not
A software company Crowd strike (CRWD) is planning to acquire another software company Firewall. The market cap for CRWD is $30 billion. CRWD does not carry any debt and the beta is 1.2. Firewall has a market cap of $16 Billion. It also has no debt but the beta is 1.6. Estimate the levered beta for CRWD after the merger if CRWD raised debt financing to fund this deal. 40% of the acquisition price came from debt. The marginal tax for CRWD is 21%.
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To estimate the levered beta for CRWD after the merger well use the Hamada equation which relates ...
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Financial Reporting Financial Statement Analysis And Valuation A Strategic Perspective
Authors: James M Wahlen, Stephen P Baginskl, Mark T Bradshaw
7th Edition
9780324789423, 324789416, 978-0324789416
