Question: An acquisition may be funded using all stock if the stock market is strong or all debt if the market interest rates are low. Suppose

An acquisition may be funded using all stock if the stock market is strong or all debt if the market interest rates are low. Suppose Supercompany uses all equity for an acquisition. Later, how could it make financial transactions that move it back to its chosen capital structure without necessarily affecting assets at that later date? Why is your proposed strategy effective?

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