21. A company that brings together a broad range of businesses is considered: (2

Question

21. A company that brings together a broad range of businesses is considered: (2 points) a. Horizontally integrated b. A conglomerate c. An oligopoly d. Vertically integrated 22. Which of the following M&A; scenarios tends to use an all-stock consideration and offer little to no premium to the target company shareholders? 2 points) a. Horizontal integration b. Vertical integration c. Merger of equals d. Forward integration 23. In a football field graphic for an M&A; transaction, which of the following is a proxy for (2 points) what a financial buyer would be willing to pay for the company? a. Precedent transactions analysis b. DCF c. LBO d. Comparable companies analysis 24. When is an all-stock merger accretive? 2 points) a. Acquirer's pro forma EPS is lower b. Target's P/E is higher than acquirer's c. Acquirer's P/E is lower than target's d. Acquirer's P/E is higher than targets 25. All of the following are intangible assets EXCEPYT (2 points) a. Brand b. Patents c. PP&E; d. Copyrights 26. Why are certain companies sometimes grouped into different "tiers" when presenting the results of a Comparable Companies Analysis? 2 points) BFIN 7225 Final Exam - Fall 2017 20171030.docx Page 5 of 10

Explanation / Answer

21. The answer is “b” – conglomerate.

A conglomerate is a corporation that is formed through acquisitions of either just one firm or several other firms and each of these firms have a different business activity. For example Hyundai in South Korea is a conglomerate.

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