easy · Investment Banking implied-share-price
In the 'Bridge' from Equity Value to Enterprise Value, why is Debt added?
- It increases the amount of cash available to the company to fund its ongoing operations
- It offsets and directly reduces the total acquisition cost paid by the buyer
- It represents a claim on the company's assets that must be paid before equity holders
- It is a non-operating asset that must be excluded entirely when isolating the core business
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