AT&T/McCaw Merger Negotiation.

1. What do you believe McCaw is worth? Prepargon a cautious DCF using the financial forecast of FCFs bumpn in the stir up and in the associated spreadsheet. What key assumptions determine the range of high and disturbed values in your valuation compend? Also mystify on any other valuation approaches and information that you can. For the rice beer of consistency, all groups should use a (low, Darden) risk premium of 5.5%. We performed a DCF Analysis for two scenarios: 1) assuming the purchase of the residual outspokenness of LIN publicize; and 2) assuming the sale of the residual equity of LIN broadcast (See adjoins 1 & axerophthol; 2). The most critical assumptions impacting value were: 1) give notice rate and 2) terminal growth rate. We relied on tax write-off order amid 10.0% and 11.0% based on our analysis of the last solo AT&T WACC (10.4%), the stand alone(predicate) McCaw WACC (12.3%), and a blended calculation (11.1%). We chose growth rates be tween 3.0% and 4.0% as an estimate of the perpetual growth of FCF (implied Value/ part was approximately $300, high by industry standards) (See Exhibit 1). In adjunct to a DCF Analysis, we performed analyses of modern comparable operations (See Exhibit 3) and new-made premiums paid for publicly traded companies (See Exhibit 4).

Results revealed that comparable proceedings were punish at approximately $171 / POP and that recent deals were fulfill on average at approximately 50% preceding(prenominal) 12 month average stock prices. In our opinion, the analysis of recent premiums paid is not reliable; as we are not able to evaluate the comparability of the included proceeding (i.e. the contemplated transaction is large). 2.! What are the advantages and disadvantages of a combination between McCaw and AT&T? What is your best alternative to a negotiated engagement with your counterparty? Advantages of a combination between McCaw... If you want to get a blanket(a) essay, order it on our website: OrderEssay.net

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