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How would the post-merger beta change

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Reference no: EM133114162

Question - Assume that Hi-Tech LLC operates in the tech industry. The company has an estimated beta of 1.15 and is planning on merging with m a company that operates hospices and has a beta of 1.65. At the time of the merger announcement, Hi-Tech was six times the size of W Estimate the combined company's beta after the merger, assuming that the merger is not expected to create or destroy value and that all pre-merger debt of the two companies will remain outstanding after the merger. In addition, how would the post-merger beta change if the merger included the retirement of all of Vitrex's debt?

Reference no: EM133114162

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