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Suppose that firm A acquires firm B in cash with the purchase price of $60 million Firm B has an existing debt of $15 million

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Suppose that firm A acquires firm B in cash with the purchase price of $60 million Firm B has an existing debt of $15 million Consider the following 4 situations: Situation 1: Fimm A pays $45 million and takes all existing debt without further borrowing. Situation 2: Finn A pays $60 million without borrowing and firm B pays off all existing debt Situation 3: Fim A pays $45 million, of which $7 million is from additional borrowing, and takes all existing debt. Situation 4: Finn A pays $60 million, of which $6 million is from borrowing, leaving firm B to pay off al existing debt. Question For each situation, calculate firm B's post-merger capital structure and the amount that firm B's shareholders receive from the deal Suppose that firm A acquires firm B in cash with the purchase price of $60 million Firm B has an existing debt of $15 million Consider the following 4 situations: Situation 1: Fimm A pays $45 million and takes all existing debt without further borrowing. Situation 2: Finn A pays $60 million without borrowing and firm B pays off all existing debt Situation 3: Fim A pays $45 million, of which $7 million is from additional borrowing, and takes all existing debt. Situation 4: Finn A pays $60 million, of which $6 million is from borrowing, leaving firm B to pay off al existing debt. Question For each situation, calculate firm B's post-merger capital structure and the amount that firm B's shareholders receive from the deal

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