easy · Investment Banking

What does Enterprise Value theoretically represent to a potential acquirer?

1. The sum of the company's future net income discounted back to the present.
2. The net cost of acquiring the business operations, assuming the target's debt is refinanced and its cash is used to offset the price.
3. The maximum amount of debt a company can support based on its current assets.
4. The dividend yield expected by investors over the next twelve months.

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