There is a firm, which we have identified to buy. It has $100 million, $30 and $70 m assets, equity and debt respectivel

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answerhappygod
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There is a firm, which we have identified to buy. It has $100 million, $30 and $70 m assets, equity and debt respectivel

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There is a firm, which we have identified to buy. It has $100
million, $30 and $70 m assets, equity and debt respectively. It
also has $40 m of cash. We want to buy a majority interest in the
firm by using a lot of debt and as little equity as possible on our
part. If we assume that there will be a 20% premium increase once
we start bidding for the firm, how much should we borrow, if we can
use the cash of the target itself to fund our
acquisition?
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