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How does a company typically optimize its capital structure in a merger and acquisition (M&A) transaction?
  • a)
    By increasing the value of equity on its balance sheet
  • b)
    By using cash to repay existing debt
  • c)
    By reducing the amount of debt on its balance sheet
  • d)
    By issuing more shares to existing shareholders
Correct answer is option 'A'. Can you explain this answer?
Most Upvoted Answer
How does a company typically optimize its capital structure in a merge...
In an M&A transaction, a company typically optimizes its capital structure by increasing the value of equity on its balance sheet, especially if it uses its own shares as consideration for the acquisition.
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How does a company typically optimize its capital structure in a merger and acquisition (M&A) transaction?a)By increasing the value of equity on its balance sheetb)By using cash to repay existing debtc)By reducing the amount of debt on its balance sheetd)By issuing more shares to existing shareholdersCorrect answer is option 'A'. Can you explain this answer?
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How does a company typically optimize its capital structure in a merger and acquisition (M&A) transaction?a)By increasing the value of equity on its balance sheetb)By using cash to repay existing debtc)By reducing the amount of debt on its balance sheetd)By issuing more shares to existing shareholdersCorrect answer is option 'A'. Can you explain this answer? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about How does a company typically optimize its capital structure in a merger and acquisition (M&A) transaction?a)By increasing the value of equity on its balance sheetb)By using cash to repay existing debtc)By reducing the amount of debt on its balance sheetd)By issuing more shares to existing shareholdersCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for How does a company typically optimize its capital structure in a merger and acquisition (M&A) transaction?a)By increasing the value of equity on its balance sheetb)By using cash to repay existing debtc)By reducing the amount of debt on its balance sheetd)By issuing more shares to existing shareholdersCorrect answer is option 'A'. Can you explain this answer?.
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