Valuation of Foreign Target Companies In 2011 , Microsoft acquired Skype (based in Luxembourg) for approximately $8.5 billion. Write a short essay that describes the general process that Microsoft would have used to determine how much it was willing to pay for Skype. Some analysts claim that Skype as an independent company was not worth $8.5 billion, but that it is worth more than $8.5 billion to Microsoft. Explain this point in your essay.

FindFind

International Financial Management

14th Edition
Madura
Publisher: Cengage
ISBN: 9780357130698
FindFind

International Financial Management

14th Edition
Madura
Publisher: Cengage
ISBN: 9780357130698

Solutions

Chapter 15, Problem 1CT
Textbook Problem

Valuation of Foreign Target Companies In 2011 , Microsoft acquired Skype (based in Luxembourg) for approximately $8.5 billion. Write a short essay that describes the general process that Microsoft would have used to determine how much it was willing to pay for Skype. Some analysts claim that Skype as an independent company was not worth $8.5 billion, but that it is worth more than $8.5 billion to Microsoft. Explain this point in your essay.

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