Apex Corporation is considering the purchase of Pinnacle Company in a stock-for-stock exchange. Selected data on the
Question:
Assume that there are no synergistic benefits as the result of the merger. Determine EPS for the combined company if Apex offers a
a. 20 percent premium for Pinnacle
b. 40 percent premium for Pinnacle
c. 50 percent premium forPinnacle
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
Transcribed Image Text:
Sales (millions) Earnings after taxes (millions) Apex $750 $100 Pinnacle $175 $ 20 20 $ 15 $ 1.00 $ 0.40 shares outstanding (millions) Share price Earnings per share Dividends per share P/E ratio Dividend payout ratio $ 40 $ 2.00 1.00 20 5%
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Related Book For
Contemporary Financial Management
ISBN: 9780324289114
10th Edition
Authors: James R Mcguigan, R Charles Moyer, William J Kretlow
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