Bulldog Industries is offering, as consideration for merger target Blazerco, 1.5 shares of their stock for each
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Bulldog Industries is offering, as consideration for merger target Blazerco, 1.5 shares of their stock for each share of Blazerco. There are 1 million shares of Blazerco outstanding, and its stock price was $50 before the merger offer. Bulldog’s preoffer stock price was $40. What is the control premium percentage offered? Now suppose that when the merger is consummated six months later, Bulldog’s stock price drops to $30. At that point, what is the control premium percentage and total transaction value?
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The preoffer value of Blazerco is 50 million 1 million shares 50share and Bulldog o...View the full answer
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Related Book For 
Introduction to Corporate Finance What Companies Do
ISBN: 978-1111222284
3rd edition
Authors: John Graham, Scott Smart
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