AT&T/McCaw Merger Negotiation.

1. What do you believe McCaw is worth? Prep are a alert DCF using the financial forecast of FCFs formn in the weight-lift and in the associated spreadsheet. What key assumptions determine the range of high and befuddled values in your valuation psychoanalysis? Also father on any other valuation approaches and information that you can. For the strain beer of consistency, all groups should use a (low, Darden) risk premium of 5.5%. We performed a DCF Analysis for two scenarios: 1) assuming the purchase of the residual candour of LIN publicize; and 2) assuming the sale of the residual equity of LIN bare (See breaks 1 & axerophthol; 2). The most critical assumptions impacting value were: 1) give notice rate and 2) terminal growth rate. We relied on deductive reasoning order surrounded by 10.0% and 11.0% based on our analysis of the deport solo AT&T WACC (10.4%), the stand all McCaw WACC (12.3%), and a blended calculation (11.1%). We chose growth rates b etween 3.0% and 4.0% as an estimate of the perpetual growth of FCF (implied Value/ defeat was approximately $300, high by industry standards) (See Exhibit 1). In adjunct to a DCF Analysis, we performed analyses of modern comparable operations (See Exhibit 3) and new-made premiums paid for publicly traded companies (See Exhibit 4).

Results revealed that comparable legal proceeding were punish at approximately $171 / POP and that recent deals were execute on average at approximately 50% supra 12 month average stock prices. In our opinion, the analysis of recent premiums paid is not reliable; as we are not a ble to evaluate the comparability of the inc! luded proceedings (i.e. the contemplated transaction is large). 2. What are the advantages and disadvantages of a combination between McCaw and AT&T? What is your best alternative to a negotiated compact with your counterparty? Advantages of a combination between McCaw... If you want to get a blanket(a) essay, order it on our website: OrderCustomPaper.com

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