Economics Homework Help

Assignment 2 is to rate the combined debt of Grainger and MSC Industrial Direct (Symbol MSM) assuming Grainger bought MSC

Grainger will buy MSC for 1.2x MSC’s recent Enterprise value of $5.45b or $6.5b

The entire purchase price will be paid for with newly issued debt with an interest rate of 4%

The rest of MSC IBD will be paid as an element of this acquisition

Rate the combined company’s using only the 2020 year-end financials (10k) and a current EBITDA for MSM of $425m (TTL)

Defend the rating and offer alternatives to the board to improve the rating of the combined company

What factor(s) is/are driving the down grad

Please do the assignment on document ”S&P Rating Fall 2021”