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I am considering buying a chemicals business. This business has assets that have an historical cost after depreciation of 3 billion dollars. So the accounting
I am considering buying a chemicals business. This business has assets that have an historical cost after depreciation of 3 billion dollars. So the accounting value of this business is 3 billion dollars today. It generates 2 billion dollars of sales with a pretax operating profit of 50%. I pay 20% taxes and my WACC is 10%. The business is not growing but it is not expected to shrink either and the profit margins have been stable for many years. I have received an offer of 5 billion to sell the business to me. Should I buy this business for 5 billion dollars
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