Valuations are required to be done on the firms and tell us if the acquisition can be done or not.This should be done on the basis of the firms balance sheets, income statement and other required financial statements of each firms. Valuation needs to be done for the firm that is going to be acquiring the other firm! There are two parts for this, valuation done before acquisition and valuation done after the acquisition. Graphs and different options for the growth rates are required. This would be help further calculating beta values and finally the free cash flows and enterprise value. Based on the enterprise value we should be able to say if the acquisition is good or not!
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