1. Is Sun Microsystems a good strategic fit for Oracle?
2. What approaches would you use to place a value on Sun Microsystems?
3. Assuming a discounted cash flow valuation:

1. What rate of return should Oracle require on the acquisition?
2. What base-case cash flows do you forecast?
3. What is your estimate of terminal value?
4. What is the enterprise value of Sun Microsystems? What is the equity value?

1. Conduct a multiples analysis to value Sun. What economic fundamentals are reflected in the multiples?
2. Identify the synergies and conduct a sensitivity analysis to estimate the effect of synergies on enterprise value.
3. If a competing bidder appears, how high a price should Oracle be willing to offer?