Notre Dame Alliance Inc.(NDA) is worth $3 billion and wants to take over Vancouver Company Inc.(VC) ,which is worth $1.5 billion.NDA expects the deal to result in $0.5 billion in synergies.Supposing a bidding war arises and NDA ends up paying $2 billion in cash for VC,and then finds there are no synergies,how much has NDA gained or lost on the deal?
A) NDA gains nothing and loses nothing on this deal.
B) NDA loses $0.5 billion on this deal.
C) NDA loses $1 billion on this deal.
D) None of the above.
Correct Answer:
Verified
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