easy · Investment Banking

In an Asset Purchase, why is the Goodwill created usually considered more valuable than in a Stock Purchase?

1. It allows the buyer to avoid assuming any of the target's liabilities.
2. It represents higher quality synergies between the two companies.
3. It does not require annual impairment testing under GAAP.
4. It is tax-deductible and can be amortized over 15 years for tax purposes.

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