Determine fundamental-standalone value

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In the Heinz case, for example, 3G and Berkshire Hathaway assumed zero synergy, yet they paid a premium of 20% to market value and 30% premium to fundamental/standalone value. More generally, this is often the case when the acquirer is a financial sponsor. Explain some of the reasons an acquirer might have to offer a premium to either market or fundamental/standalone value even without the ability to capture synergies.

Reference no: EM132670238

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