Bayes Enterprises offers 10 and 1 newly issued share for each share of Finsbury Plc. There...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Bayes Enterprises offers £10 and 1 newly issued share for each share of Finsbury Plc. There are 1 million shares in Bayes and 600,000 shares in Finsbury, with market valuations of £120m and £30m, respectively. A) Assuming no synergies and that the current market valuations are a good estimate of both companies' standalone values, what is the value of the offer for a shareholder of Finsbury? B) In some countries large corporate decisions must be approved by firms' shareholders. Should Bayes' shareholders support the deal under its current conditions? What would be Bayes' price after the acquisition? C) D) What level of synergies, in millions of £, would make this offer attractive for both groups of shareholders? How would your answers to (A) and (B) change if the true values of Bayes and Finsbury were £80m and £70m, respectively? Assume that there are no synergies. Bayes Enterprises offers £10 and 1 newly issued share for each share of Finsbury Plc. There are 1 million shares in Bayes and 600,000 shares in Finsbury, with market valuations of £120m and £30m, respectively. A) Assuming no synergies and that the current market valuations are a good estimate of both companies' standalone values, what is the value of the offer for a shareholder of Finsbury? B) In some countries large corporate decisions must be approved by firms' shareholders. Should Bayes' shareholders support the deal under its current conditions? What would be Bayes' price after the acquisition? C) D) What level of synergies, in millions of £, would make this offer attractive for both groups of shareholders? How would your answers to (A) and (B) change if the true values of Bayes and Finsbury were £80m and £70m, respectively? Assume that there are no synergies. Bayes Enterprises offers £10 and 1 newly issued share for each share of Finsbury Plc. There are 1 million shares in Bayes and 600,000 shares in Finsbury, with market valuations of £120m and £30m, respectively. A) Assuming no synergies and that the current market valuations are a good estimate of both companies' standalone values, what is the value of the offer for a shareholder of Finsbury? B) In some countries large corporate decisions must be approved by firms' shareholders. Should Bayes' shareholders support the deal under its current conditions? What would be Bayes' price after the acquisition? C) D) What level of synergies, in millions of £, would make this offer attractive for both groups of shareholders? How would your answers to (A) and (B) change if the true values of Bayes and Finsbury were £80m and £70m, respectively? Assume that there are no synergies. Bayes Enterprises offers £10 and 1 newly issued share for each share of Finsbury Plc. There are 1 million shares in Bayes and 600,000 shares in Finsbury, with market valuations of £120m and £30m, respectively. A) Assuming no synergies and that the current market valuations are a good estimate of both companies' standalone values, what is the value of the offer for a shareholder of Finsbury? B) In some countries large corporate decisions must be approved by firms' shareholders. Should Bayes' shareholders support the deal under its current conditions? What would be Bayes' price after the acquisition? C) D) What level of synergies, in millions of £, would make this offer attractive for both groups of shareholders? How would your answers to (A) and (B) change if the true values of Bayes and Finsbury were £80m and £70m, respectively? Assume that there are no synergies.
Expert Answer:
Answer rating: 100% (QA)
A Based on the information provided Bayes has 1 million shares valued at 120m so each share is worth ... View the full answer
Related Book For
Auditing An International Approach
ISBN: 978-0071051415
6th edition
Authors: Wally J. Smieliauskas, Kathryn Bewley
Posted Date:
Students also viewed these law questions
-
Jefferson County established a capital project fund in 2 0 2 3 to build low - income housing with the transfer of $ 1 0 0 , 0 0 0 from the General Fund. A portion of that was expended on engineering...
-
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
-
List three specific parts of the Case Guide, Objectives and Strategy Section (See below) that you had the most difficulty understanding. Describe your current understanding of these parts. Provide...
-
The dehydration butanol of alumina is carried out over a silica-alumina catalyst at 680K. CH3CH2CH2CH20H------->cat CH3CH=CHCH3 + H2O The rate law is -r Bu = KPBU/(1+KBuPBul with k= 0.054...
-
Drop two balls of different masses from the same height, and, at low speeds, they practically fall together. Will they roll together down the same inclined plane? If each is suspended from an equal...
-
If a standard curve graph of the density of a solution vs % (w/v) of a solute in water was created and the best fit line to the data points had the equation y = 0.005297x + 1.0029, to the correct...
-
The balance sheet data for Bobs Electronics, Co., November 30, 2010, follow: Requirement 1. The following are three independent assumptions about the business during November. For each assumption,...
-
Your friendly foreign exchange trader has given you the following currency cross rates. The quotes are expressed as units of the currency represented in the left-hand column per unit of currency...
-
If you purchase an annuity for $50,000 that pays $5,000 per year for 20 years, how much will the annuity pay out in the last year.
-
Managers often assume a strictly linear relationship between cost and the level of activity. Under what conditions would this be a valid or invalid assumption?
-
Given the initial setup of a match between two players, evaluate the match's outcome. There are two players, and there is a number sequence of size n. Players alternate turns for n rounds. Each...
-
If investors attempt to buy a stock with a positive alpha, what is likely to happen to its price and expected return? How will this affect its alpha?
-
If interest rates rise, what happens to the value today of a promise of money in one year?
-
What is the incremental IRR and what are its shortcomings as a decision rule?
-
In order to compare the costs and benefits of a decision, what must we determine?
-
Explain why the risk of a security should not be evaluated in isolation.
-
Assume a student is contemplating whether or not he should write the test of his risk analysis course or defer it to after his vacations. He is 50/50 on deferring or writing the test when his...
-
Carlton Stokes owns and operates a car-detailing business named SuperShine & Detailing. For $150, Carltons business will hand wash and wax customers cars, vacuum the interior, and thoroughly clean...
-
What should be the relationship between tolerable misstatement in the audit of an account balance and the amount of monetary misstatement considered material to the overall financial statements?
-
The diagram in Exhibit EP13-11 describes several payroll test of control procedures. It shows the direction of the tests, leading from samples of time cards, payrolls, and cumulative year-to-date...
-
The four questions below are taken from an internal control questionnaire. For each question, state (i) one control test you could use to find out whether the control technique was really used, and...
-
What are the three different types of qualified audit opinion? Discuss the circumstances that may cause these qualifications.
-
What is the effect of a fundamental uncertainty on the auditors report?
-
Discuss the work that an auditor performing an initial engagement needs to perform on opening balances.
Study smarter with the SolutionInn App