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The WACC-DCF approach to valuation is not as useful as the APV approach in leveraged buyouts because: 1-there is greater risk with a LBO. 2-the
The WACC-DCF approach to valuation is not as useful as the APV approach in leveraged buyouts because: 1-there is greater risk with a LBO. 2-the capital structure is changing. 3-there is no tax shield with the WACC. 4-the value of the levered and unlevered firms are equal. 5-the unlevered and levered cash flows are separated which cannot be used with the WACC approach
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Contemporary Business Mathematics with Canadian Applications
Authors: S. A. Hummelbrunner, Kelly Halliday, K. Suzanne Coombs
10th edition
133052311, 978-0133052312
