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Illustrates beta and capital structure are relevant or not

We are valuing a company, many smaller than ours, so as to buy it. As that company is too smaller than ours this will have no influence on the capital structure and at the risk of the resulting company. It is the reason why I believe this the beta and the capital structure that are relevant to the valuation of the company we are analyzing here are the ones of our company. So, am I right?

E

Expert

Verified

No, the relevant risk is the acquired assets. If that were not the case, a government bond must have a various value for each company.

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