T Mobile + Sprint Cost Synergies - $6bn synergies, $43bn NPV, 8% WACC
J. Braxton Carter T-Mobile US, Inc. - Executive VP & CFO: "Hey, the first thing, we talked about run-rate synergies of $6-plus billion. I want to emphasize that’s pretax. We’ve talked about cost to achieve of $15 billion and gave you more details on this call. That’s pretax. And we’ve talked about the NPV of the synergies being an amazing $43 billion plus. The NPV is discounted at an 8% WACC and is post the tax effect. " Ref: https://www.sec.gov/Archives/edgar/data/101830/00…
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Question: Doesn't $6bn in annual synergies @ 8% discount rate translate to $75bn in NPV? (e.g. 75=6/.08)
Hoping someone can shed some light on how to make sense of the 8% WACC, and $43 in NPV. Thank you.
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