hard · Investment Banking
Buyer (EPS 4.00, 50M shares, 30% tax) acquires Target using $800M in new debt at 9% interest. Target EBIT is $80M and it has $10M in existing interest expense which will be removed. Incremental amortization is $15M pre-tax. Calculate breakeven pre-tax synergies.
- $4.9 million
- $10.0 million
- $7.0 million
- $12.4 million
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