Say you buy a supplier. They charge you $10 and it costs them $6 to make the product. Isn’t this value destructive as while your expenses decrease by $10, their IS decreases by $16 ($10 revenue plus the $6 expense they still occur).
This is embarrassing but I literally can’t think around this. The synergy isn’t the profit margin? Or is not tangible ie less volatility in cogs, not reliant on a single supplier, etc.
It would seem to me that accretion / dilution wise this is negative?
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