The owners of Arthouse Inc., a national artist supplies chain, are contemplating purchasing Craftworks Inc, a smaller
Fantastic news! We've Found the answer you've been seeking!
Question:
The owners of Arthouse Inc., a national artist supplies chain, are contemplating purchasing Craftworks Inc, a smaller chain. Arthouse's analysts project that the merger will result in incremental free flows and interest tax savings with a combined present value of $72.52 million, and they have determined that the appropriate discount rate for valuing Craftworks is 16%. Craftworks have 4 million shares outstanding and no debt. Craftworks' current price is $16.25. What is the maximum price per share that Arthouse should offer?
Related Book For
Statistics Principles and Methods
ISBN: 978-0470904114
7th edition
Authors: Richard A. Johnson, Gouri K. Bhattacharyya
Posted Date: