Your firm has tangible assets of $98.6 million. You are planning to acquire a firm that is half your firm's size. You have bonds with a merger & acquisition covenant that requires the combined firm to have a minimum ratio of net tangible assets to debt of 1.6. Your firm has a ratio of 2.2 and the target firm has a ratio of 11. Can you take on any more debt in the acquisition and not violate your covenant?
The combined company ________ more debt.