Suppose the pre-acquisition market capitalization of Amersham was $8 billion and that this market capitalization did not reflect the possibility that Amersham will be acquired. In order to justify the purchase price of $10 billion for all of Amersham's equity, what is the additional annual no-growth FCF in perpetuity that GE needs to generate, starting from one year after the acquisition? The relevant WACC is 10%.

Answer rating: 100% (QA)

Heres how to calculate the additional annual nogrowth FCF Free Cash Flow GE needs to generate 1 Exc... View the full answer