Your job is to identify a potential acquisition target for the company and outline the risks involved in the acquisition transaction. State your assumptions and perform a sensitivity analysis of the net present value of the merger. (20 marks) Expectations. One of the most important risks in any acquisition transaction is the mis-estimation of potential synergies, as both the cost of the merger and the net present value of the merger are highly dependent on it. Students are therefore required to perform a sensitivity analysis of the NPV of the merger based on how the synergies are estimated. For example, if the synergies arise from lower costs or higher revenues, what are the factors that influence these benefits and how sensitive is the NPV estimate to changes in these factors?