Perform similar valuation for broadway as a standalone firm

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Reference no: EM13988238

Download the Landmark Facility Case (also download the associated Excel supplement). Use the data from the case to answer the following questions:

1. Use the projections in Exhibit 3 to value Landmark as a standalone firm. Perform a similar valuation for Broadway as a standalone firm. For both companies, assume that free cash flows grow at 4% after 2019. (Note that 2014 is year 0, so we discount cash flows from 2015 onward to find the current value of the firms).

2. Now, repeat your valuation under the assumptions that Broadway acquires Landmark. You will need to update your free cash flow projections for both Broadway and Landmark using the assumptions stated in the case. What is the value of the synergies in this acquisition? (Hint: rather than try to value the new firm combined, it is easier in this case to value Landmark and Broadway separately, but with the changes in cash flows as stated in the case. Synergies are then the sum of these two valuations less than sum of the two original valuations.)

Please turn in your case as an Excel workbook. Your Excel file only needs to have your DCF models; text explanations are not necessary. Please reference the key items of your analysis in separate cells (e.g., WACC, growth rates, etc.) so that you can easily see how sensitive your valuation is to your assumptions.

Attachment:- Landmark Facility Solutions Case.rar

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The solution relates to Landmark Facility. In the given case using the projections in Exhibit 3, the value of Landmark is calculated as a standalone firm. Then again the value of Broadway as a standalone firm is calculated. assuming that the free cash flows grow at 4% after 2019. For calculation of value of firm further variables were also calculated like, cost of equity, debt and WACC.

Reference no: EM13988238

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