Question
Company Information: Enbridge Inc: Enbridge Inc. is a multinational pipeline company headquartered in Calgary, Alberta, Canada. Air Canada Inc: Air Canada is the flag carrier
Company Information:
Enbridge Inc: Enbridge Inc. is a multinational pipeline company headquartered in Calgary, Alberta, Canada.
Air Canada Inc: Air Canada is the flag carrier and the largest airline of Canada by fleet size and passengers carried.
Suncor Energy Inc.: Suncor Energy is a Canadian integrated energy company based in Calgary, Alberta. It specializes in production of synthetic crude from oil sands.
Canadian Natural Resources: Canadian Natural Resources Limited, or CNRL or Canadian Natural is a Canadian company engaged in hydrocarbon exploration primarily in Western Canada,
Imperial Oil Ltd.: Imperial Oil Limited is a Canadian petroleum company. It is Canada's second-biggest integrated oil company.
Pizza Pizza Royalty Group: Pizza Pizza Ltd. is a franchised Canadian pizza quick-service restaurant with its headquarters in Toronto, Ontario.
Loblaw Companies Ltd: Loblaw Companies Limited is a Canadian food retailer, encompassing corporate and franchise supermarkets operating under 22 regional and market segment banners, as well as pharmacies, banking and apparel.
Canadian Tire Corp: Canadian Tire Corporation Limited is a Canadian retail company that operates in the automotive, hardware, sports, leisure and housewares sectors.
Metro Inc.: Metro Inc. is a Canadian food retailer operating in the provinces of Quebec and Ontario.
TC Energy Corp: TC Energy Corporation is a major North American energy company, based in the TC Energy Tower building in Calgary, Alberta, Canada, that develops and operates energy infrastructure in Canada
Please complete parts a-d of this one question and provide calculations. I will upvote!!
Question 2: It is January of 2020. Rapid Corporation is in the process of acquiring Tamed Inc. Tamed Inc. has two divisions: oil and gas and retail grocery. The current number of outstanding shares is 200. *** Show all calculations a) (4 marks) Which companies (Choose from the provided list) should you include in your analysis? Explain! b) (8 marks) What do you recommend for the total value of the oil and gas division? What about the retail grocery division? Explain how you collect the required information. c) (4 marks) The management of Tamed Inc. has informed Rapid Corporation that the Cost of goods sold for the retail grocery division was abnormally high this year due to the temporary closure of one of the local suppliers. We expect a much lower cost of goods sold for that division in the future. Given this information, what do you recommend for the total value of the oil and gas division? What about the retail grocery division? d) (4 marks) Rapid Corporation is offering $71 per share. Given the information in part (b), would you recommend the shareholders of Tamed Inc. to accept the offer or decline it? Explain! Hint: You need to use multiples in your analysis and valuation of Tamed Inc.! Statement of Comp. Income (Oil and Gas Division) Sales 2,000 Cost of goods 700 sold Depreciation EBIT 1,000 Interest paid 200 Taxable income Taxes (40%) 320 Net Income 480 300 Statement of Comp. Income (Retail Grocery Division) Sales 15,500 Cost of goods 14,400 sold Depreciation 500 EBIT 600 Interest paid 100 Taxable income 500 Taxes (40%) 200 Net Income 300 Statement of Comp. Income (Consolidated Statement) Sales 17,500 Cost of goods 15100 sold Depreciation 800 EBIT 1,600 Interest paid 300 Taxable income 1,300 Taxes (40%) 520 Net Income 780 800 Companies Enbridge Inc. Air Canada Inc. Suncor Energy Inc. Canadian Natural Resources Imperial Oil Ltd Pizza Pizza Royalty Corp Loblaw Companies Ltd Canadian Tire Corp. Metro Inc. TC Energy Corp. Question 2: It is January of 2020. Rapid Corporation is in the process of acquiring Tamed Inc. Tamed Inc. has two divisions: oil and gas and retail grocery. The current number of outstanding shares is 200. *** Show all calculations a) (4 marks) Which companies (Choose from the provided list) should you include in your analysis? Explain! b) (8 marks) What do you recommend for the total value of the oil and gas division? What about the retail grocery division? Explain how you collect the required information. c) (4 marks) The management of Tamed Inc. has informed Rapid Corporation that the Cost of goods sold for the retail grocery division was abnormally high this year due to the temporary closure of one of the local suppliers. We expect a much lower cost of goods sold for that division in the future. Given this information, what do you recommend for the total value of the oil and gas division? What about the retail grocery division? d) (4 marks) Rapid Corporation is offering $71 per share. Given the information in part (b), would you recommend the shareholders of Tamed Inc. to accept the offer or decline it? Explain! Hint: You need to use multiples in your analysis and valuation of Tamed Inc.! Statement of Comp. Income (Oil and Gas Division) Sales 2,000 Cost of goods 700 sold Depreciation EBIT 1,000 Interest paid 200 Taxable income Taxes (40%) 320 Net Income 480 300 Statement of Comp. Income (Retail Grocery Division) Sales 15,500 Cost of goods 14,400 sold Depreciation 500 EBIT 600 Interest paid 100 Taxable income 500 Taxes (40%) 200 Net Income 300 Statement of Comp. Income (Consolidated Statement) Sales 17,500 Cost of goods 15100 sold Depreciation 800 EBIT 1,600 Interest paid 300 Taxable income 1,300 Taxes (40%) 520 Net Income 780 800 Companies Enbridge Inc. Air Canada Inc. Suncor Energy Inc. Canadian Natural Resources Imperial Oil Ltd Pizza Pizza Royalty Corp Loblaw Companies Ltd Canadian Tire Corp. Metro Inc. TC Energy CorpStep by Step Solution
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