Question: Question 2 (August 2016) a) MAX Berhad is determined to report earnings per share of RM7, when it acquires MIN Berhad. Some information is presented

Question 2 (August 2016) a) MAX Berhad is determined to report earnings per share of RM7, when it acquires MIN Berhad. Some information is presented as below: MAX RM6MIN RM7.5 RM20 2 million Earnings per share Price per share5 million Number of shares Price-earnings ratio Total carnings Total market value RM25 Assume that there is no positive synergy from this merger and MAX issues just enough of its shares to acquire MIN. Analyse and advise MAX on this merger and acquisition event by: (i) completing the above table; and (ii) calculating the above information for the merged firm. Calculate the amount of shares MAX will exchange for each share of MIN. (10 marks)

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