Firm A is considering a merger/acquisition with Firm B. Based on the following data, what is...
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Firm A is considering a merger/acquisition with Firm B. Based on the following data, what is the stock exchange ratio if Firm A negotiates a merger with Firm B and if all the synergy gain goes to Firm A's shareholders? Firm A: Market value of debt: $4 million Market value of equity: $6 million Number of shares: 0.5 million Estimated total firm value based on value-based management model if the merger takes place: 12 million Firm B: Market value of debt: $6 million Market value of equity: $7 million Number of shares: 0.5 million Estimated total firm value based on value-based management model if the merger takes place: 15 million Firm A is considering a merger/acquisition with Firm B. Based on the following data, what is the stock exchange ratio if Firm A negotiates a merger with Firm B and if all the synergy gain goes to Firm A's shareholders? Firm A: Market value of debt: $4 million Market value of equity: $6 million Number of shares: 0.5 million Estimated total firm value based on value-based management model if the merger takes place: 12 million Firm B: Market value of debt: $6 million Market value of equity: $7 million Number of shares: 0.5 million Estimated total firm value based on value-based management model if the merger takes place: 15 million
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Related Book For
Corporate Finance
ISBN: 978-0077861759
11th edition
Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford Jordan
Posted Date:
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