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Company ACC.

Company ACC. an ungeared car manufacturer has launched a takeover bid of Company BDD. a key competitor operating in the same industry Company BDD has high gearing Company ACC has a large surplus cash balance and believes that the acquisition is an opportunity to enhance shareholder wealth through the realisation of synergistic benefits. Which THREE of the following would most likely be synergistic benefits to Company ACC of purchasing Company BDD9 I

A.

Reduction in staff costs due to the removal of duplicated roles.

B.

Decreased cost of debt

C.

Enhanced profit due to reduced competition

D.

Reduction in financial risk due to diversification

E.

Cost savings in production due to economies of scale

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