Prior to the merger, Firm Dune has RM1,140 in total earnings with 760 shares outstanding at...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Prior to the merger, Firm Dune has RM1,140 in total earnings with 760 shares outstanding at a market price per share of RM40. Firm Matrix has RM680 in total earnings with 175 shares outstanding at RM19 per share. Assume Firm Dune acquires Firm Matrix via an exchange of stock at a price of RM20 for each share of Matrix's stock. Both Dune and Matrix have no debt outstanding. (i) What will the earnings per share of Firm Dune be after the merger? (ii) Provide FOUR examples of cost reductions that can result from an acquisition. Prior to the merger, Firm Dune has RM1,140 in total earnings with 760 shares outstanding at a market price per share of RM40. Firm Matrix has RM680 in total earnings with 175 shares outstanding at RM19 per share. Assume Firm Dune acquires Firm Matrix via an exchange of stock at a price of RM20 for each share of Matrix's stock. Both Dune and Matrix have no debt outstanding. (i) What will the earnings per share of Firm Dune be after the merger? (ii) Provide FOUR examples of cost reductions that can result from an acquisition.
Expert Answer:
Answer rating: 100% (QA)
i Earnings per Share EPS after Merger To calculate the EPS after the merger we need to consider the ... View the full answer
Related Book For
Corporate Finance
ISBN: 9781265533199
13th International Edition
Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe
Posted Date:
Students also viewed these finance questions
-
Utilizing resoorces, complete a risk audit of Bank of Americas project to acquire Merrill Lynch. Ensure you address all 10 critical success factors. From the evidence of your audit, would you advise...
-
Three forces are acting on the ring in Figure 23. What is the net force acting on the ring? +y 128 N luo 128 N 30.0 64 N +x Figure 23 A Ship at Sea A ship at sea is due into a port 500.0 km due south...
-
?Claim: A of adults would erase all of their personalinformation online if they could. A software firm survey of 511randomly selected adults showed that 36 ?% of them would erase allof their pe...
-
(a) What is the uncertainty in the energy released in the decay of a (0 due to its short lifetime? (b) What fraction of the decay energy is this, noting that the decay mode is (0 + (so that all...
-
On December 31, 2012, Port Co. sold 6-monthold equipment at fair value and leased it back. There was a loss on the sale. Port pays all insurance, maintenance, and taxes on the equipment. The lease...
-
Create formulas for the following in an Excel worksheet: a. Add the values of 3 and 5 to one another. b. Subtract the value of 5 from 1 O and multiply the outcome by 7. c. Average the values 5, 6, 7,...
-
Trudy Company incurred the following costs. 1. Sales tax on factory machinery purchased $5,000 2. Painting of and lettering on truck immediately upon purchase 700 3. Installation and testing of...
-
discuss any instances where your commitment to the organization has been tested, and how you navigated those challenges?
-
Problem 2: A droplet of oxidizer is being evaporated inside the combustion chamber of a rocket. Its current diameter is 0.2mm and its velocity is Udroplet = 180m/s +10m/s in the combustion chamber's...
-
Suppose Sit Down, Co. reported LIFO beginning inventory of $4,056 and LIFO ending inventory of $4,121 in fiscal year 2017. Inventory purchases for 2017 were $21,590 and the change in the LIFO reserve...
-
A firm produces a combined 40,000 units from 2 different shifts utilizing 500 combined labor hours and $1500 of raw materials at a labor rate of $15 per hour. Calculate the Labor Productivity...
-
Teal Mountain Consulting, LLC is a service firm that applies overhead based upon direct labor hours. The information below was provided for the current period. Budgeted Manufacturing Overhead Cost...
-
A water wave has a frequency of 6 Hz and a wavelength of 3 m. 1. what is the period (in seconds) of these waves? 2. what is the wave velocity (in m/s)?
-
1. A 600.0 Hz sound has a velocity of 1087.0 ft/s in the air and a velocity of 4920.0 ft/s in water. a.what is the wavelength (in ft) of this sound in the air? b. what is the wavelength (in ft) of...
-
Leniency programmes create incentives for firms to behave in what ways? a. To be lenient with suppliers failing to live up to contractual obligations b. To be lenient with competitors suggesting...
-
Find the volume of the described solid S. A frustum of a right circular cone with height h, lower base radius R, and top radius r -r- --R
-
Bicksler Enterprises is considering a $10 million project that will last five years, with straight-line depreciation of $2 million per year. The cash revenues less cash expenses per year are $3.5...
-
Bernard Dumas will receive $10,000 three years from now. Bernard can earn 8 percent on his investments, so the appropriate discount rate is 8 percent. What is the present value of his future cash...
-
Professional Artworks, Inc., is a firm that speculates in modern paintings. The manager is thinking of buying an original Picasso for $400,000 with the intention of selling it at the end of one year....
-
What is the direction of the magnetic field lines inside the bar magnet of Figure 27.13? Figure 27.13 Magnetic field line pattern surrounding a bar magnet. N S
-
(a) Consider a single elementary magnet inside a closed surface. Given that elementary magnets are particles without spatial extent, is the magnetic field line flux through the closed surface...
-
Sketch the magnetic field line pattern in the horizontal plane around the rod in Figure 27.16. Figure 27.16 A flow of charge carriers through a conducting rod causes a circular alignment of compass...
Study smarter with the SolutionInn App