medium · Investment Banking ma-lbo
In an Asset Purchase, why is the Goodwill created usually considered more valuable than in a Stock Purchase?
- It allows the buyer to avoid assuming any of the target's liabilities.
- It represents higher quality synergies between the two companies.
- It does not require annual impairment testing under GAAP.
- It is tax-deductible and can be amortized over 15 years for tax purposes.
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