Riverrocks whose wacc is 115 is considering an acquisition


Problem

RiverRocks, whose WACC is 11.5% is considering an acquisition of Raft Adventures (whose WACC is 15.1). The purchase will cost $ 104.6 million and will generate cash flows that start at $ 14.7 million in one year and then grow at 4.2 % per year forever. What is the NPV of the acquisition?

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Accounting Basics: Riverrocks whose wacc is 115 is considering an acquisition
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