you are financial analyst working for Broadcom (ticker symbol AVGO), which is a huge chip manufacturer. It is considering the acquisition of a competing chip firm, Qualcomm (ticker symbol QCOM). The CFO of Broadcom has tasked you with evaluating the potential deal. Before Broadcom employs any capital budgeting tools to decide whether the deal should go through, it needs to determine the anticipated cash flows of the newly merged company.

• As the financial analyst, how would you go about finding out if it is an investment worth doing?
• What are the types of cash flows financial analysts would need to examine before performing capital budgeting analysis?
• What additional revenues and costs should be evaluated? What risks could exist with the acquisition?