Firm A has a market value of $600 MM and 30 MM shares outstanding. Firm B has
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Question:
Firm A has a market value of $600 MM and 30 MM shares outstanding. Firm B has a market value of $200 MM and 20 MM shares outstanding. A is contemplating acquiring B. Firm A's CFO concludes that the combined firm with synergy will be worth about $1.05 billion and Firm B can be acquired at a premium of $150 MM.
Q1
If Firm A offers 15 MM shares to exchange for the 20 MM shares of B, What is the post acquisition price for Firm AB?
Related Book For
Corporate Finance
ISBN: 9780077173630
3rd Edition
Authors: David Hillier, Stephen A. Ross, Randolph W. Westerfield, Bradford D. Jordan, Jeffrey F. Jaffe
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