Question: Example: Maximum exchange ratio in a stock takeover At the time Sprint announced plans to acquire Nextel, Sprint stock was trading for $25 per share

Example: Maximum exchange ratio in a stock takeover At the time Sprint announced plans to acquire Nextel, Sprint stock was trading for $25 per share and Nextel stock was trading for $30 per share, implying a premerger value of Nextel of approximately $31 billion. If the projected synergies were $12 billion, what is the maximum exchange ratio Sprint could offer in a stock swap and still generate a non-negative NPV

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