Briefly explain your assumptions and repeat (1) above and show your operating projections for the next five years and the profit projection in year 5 in these two additional scenarios. Briefly explain and discuss the sensitivity of your main findings based on your scenario testing.
The initial fees and expenses associated with the acquisition are $2,600,000. You have an exit strategy of five years and would sell the company after five years at the same EBITDA multiple you chose above. Assume that interest rate is 5%, the yearly capital expenditure is $1,300,000 and the tax rate is 30%. Required: 1) […]