Bhavna, Bhavna

IBIMT2023
Feb ua y 10, 2023

Midterm_IB 90% (18/20)

1. Back office in an Investment banks is likely to deal with which of the following
1/1 POINT

A Risk management

B Equity Issuance

C Product Groups

D Accounting

2. Chinese wall separates the

1/1 POINT

A M&A group from Sales & Trading

B M&A group from Capital Market group

C Sales & Trading from Asset & Wealth management group

D None

3. Quess Ltd Acquirer) is buying Simplilea n Ltd Target) at an enterp ise value of Rs.1000cr. If
the debt and cash for the target are at Rs.300cr and Rs.100cr respectively then the equity
value of the target is (in cr)
0/1 POINT

A 1000

B 800

C 1200

D 1400
4. Given the balance sheet of ABC Ltd Target). If the company is
acquire at 1000cr and the other cu rent assets are fair valued to
Rs.400cr while the fixed assets are fair valued to Rs. 700cr, then
the goodwill to be recognized by the acqui ing entity would be in
Rs. cr
1/1 POINT

A 150

B 450

C 550

D 250

5. Given the table in the exhibit as well as the info mation below:
1. Target is being acquired at equity value of Rs.1000cr.
2. Other cu rent assets of target are fair valued to 500cr
3. Fixed assets of target are fair valued to 700cr.
4. The acquisition is done using cash 40%) and stock 60%)
5. To fund the acquisition the acquirer will issue debt of Rs.300cr
6. The debt of target will be re-financed
7. Debt financing fee of 16cr will be paid to Investment banks
Given the above info mation, the value of "B" in the table will be:
1/1 POINT

A 50

B 100

C 150

D 250

6. Given the table in the exhibit as well as the info mation below:
1. Target is being acquired at equity value of Rs.1000cr.
2. Other cu rent assets of target are fair valued to 500cr
3. Fixed assets of target are fair valued to 700cr.
4. The acquisition is done using cash 40%) and stock 60%)
5. To fund the acquisition the acquirer will issue debt of Rs.300cr
6. The debt of target will be re-financed
7. Debt financing fee of 16cr will be paid to Investment banks
Given the above info mation, the value of "A" in the table will be:
1/1 POINT

A 400

B 300

C 200

D 250
7. Given the table in the exhibit as well as the info mation below:
1. Target is being acquired at equity value of Rs.1000cr.
2. Other cu rent assets of target are fair valued to 500cr
3. Fixed assets of target are fair valued to 700cr.
4. The acquisition is done using cash 40%) and stock 60%)
5. To fund the acquisition the acquirer will issue debt of Rs.300cr
6. The debt of target will be re-financed
7. Debt financing fee of 16cr will be paid to Investment banks
Given the above info mation, the value of "U" in the table will be:
1/1 POINT

A 445

B 376

C 234

D 250

8. Given the table in the exhibit as well as the info mation below:
1. Target is being acquired at equity value of Rs.1000cr.
2. Other cu rent assets of target are fair valued to 500cr
3. Fixed assets of target are fair valued to 700cr.
4. The acquisition is done using cash 40%) and stock 60%)
5. To fund the acquisition the acquirer will issue debt of Rs.300cr
6. The debt of target will be re-financed
7. Debt financing fee of 16cr will be paid to Investment banks
Given the above info mation, the value of "O" in the table will be:
1/1 POINT

A 2000

B 1500

C 1100

D 1600
 9. Given the table in the exhibit as well as the info mation below:
1. Target is being acquired at equity value of Rs.1000cr.
2. Other cu rent assets of target are fair valued to 500cr
3. Fixed assets of target are fair valued to 700cr.
4. The acquisition is done using cash 40%) and stock 60%)
5. To fund the acquisition the acquirer will issue debt of Rs.300cr
6. The debt of target will be re-financed
7. Debt financing fee of 16cr will be paid to Investment banks
Given the above info mation, the value of "L" in the table will be:
1/1 POINT

A 2347

B 4221

C 3134

D 5203

10. Given the table in the exhibit as well as the info mation below:
1. Target is being acquired at equity value of Rs.1000cr.
2. Other cu rent assets of target are fair valued to 500cr
3. Fixed assets of target are fair valued to 700cr.
4. The acquisition is done using cash 40%) and stock 60%)
5. To fund the acquisition the acquirer will issue debt of Rs.300cr
6. The debt of target will be re-financed
7. Debt financing fee of 16cr will be paid to Investment banks
Given the above info mation, the value of "P" in the table will be:
1/1 POINT

A 1347

B 2221

C 1584

D 1203

11. Piramal Pha ma wishes to acquire Hetero Labs.Given the

info mation in the table. Also given that the synergy benfits equal
2000. If Hetero labs is willing to be acquired at 50 per share in
cash, the NPV of the merger is
1/1 POINT

A 1000

B 2000

C 9000

D 10000
12. Piramal Pha ma wishes to acquire Hetero Labs. Given the
info mation in the table. Also given that the synergy benfits equal
2000. If Hetero labs is willing to be acquired at 50 per share in
cash, the p ice per share of merged fi m will be
1/1 POINT

A 190

B 200

C 180

D 120

13. Piramal Pha ma wishes to acquire Hetero Labs. Given the

info mation in the table. Also given that the synergy benefits
equal 2000. If Hetero labs is willing to be acquired in stock with
Piramal offe ing one share of merged entity for eve y 4 shares of
Hetero labs, then the p ice per share of merged fi m will be
1/1 POINT

A 193.3

B 184.5

C 290.0

D 112

14. Piramal Pha ma wishes to acquire Hetero Labs. Given the

info mation in the table. Also given that the synergy benefits
equal 2000. If Hetero lab is willing to be acquired in stock with
Piramal offe ing one share of merged entity for eve y 4 shares
of Hetero labs, then the NPV of the merger is
1/1 POINT

A 1333.3

B 1230.3

C 1100.7

D 0

15. An Accretive acquisition is likely to lead to

1/1 POINT

A Increase in EPS of the merged entity

B Decrease in EPS of the merged entity

C Increase in Debt to equity of the merged entity

D Decrease in Debt to equity of the merged entity

16. In an acquisition a target company is likely to choose cash payment over stock payment on
account of
1/1 POINT

A Higher outgo of tax

B Desire to control the merged entity

C Sha ing in future gains of the merged entity

D Lack of faith in prospects of the merged entity

17. A "tease " floated by sell side Investment bank is likely to contain
1/1 POINT

A Name of the selling company

B Company ove view

C Purchase contracts

D Customer and supplier list

18. Which of the following debt st uctures is likely to provide more time to bo rower to make
payment
0/1 POINT

A Senior Debt

B Mezzanine Finance

C Pay-in-kind debt

D None

19. Mandato ily conve tible preference shares will have

1/1 POINT

A higher debt content

B higher equity content

C equal mix of debt and equity

D None

20. Systemically Impo tant banks are required to have

1/1 POINT

A lower capital requirements

B higher capital requirements

C lower credit ratings

D None