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Consider the Combined Income Statement shown below, for an M&A deal between two restaurant / retail companies: The Definite - Lived Intangibles created in this
Consider the Combined Income Statement shown below, for an M&A deal between two restaurantretail companies:
The DefiniteLived Intangibles created in this deal are approximately $min
The deal is financed with approximately Cash and Debt, and the Debt allows for optional repayments if the
company has excess cash flow.
Based on this information and the screenshot above, which of the following answer choices represent LIKELY
A The Revenue Synergies and OpEx Synergies grow at very high rates, at over and respectively, over
years; these assumptions are too aggressive.
B There's no additional OpEx or COGS associated with the Revenue Synergies.
C The Integration Costs and Restructuring Costs do not appear on the Income Statement.
D The Interest Paid on New Debt stays the same each year, even though the company is likely repaying some
amount of this New Debt over time.
E The Amortization of Intangibles and Depreciation of the PP&E WriteUp both seem too large, based on the
assumptions above.
F All of the above.
G Answer choices A B and C
H Answer choices A C D and E
I Answer choices B and D
J Answer choices A B and D
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