Your firm has tangible assets of $101.9 million. You are planning to acquire a firm that is half your firm's size. You have bonds with a merger & acquisition covenant that requires the combined firm to have a minimum ratio of net tangible assets to debt of 1.6.Your firm has a ratio of 1.9 and the target firm has a ratio of 1.3 . Can you take on any more debt in the acquisition and not violate your covenant?

The combined company

can/false answer

take

on more debt.