Scrappy Corp. has 100M shares outstanding and a poison pill in place that will be triggered if an investor acquires 10% or more of outstanding shares. The poison pill allows all other shareholders to buy two additional shares at half the market price. Suppose a raider accumulates 10M shares of Scrappy's stock at $10 per share, thus costing $100M. This triggers the poison pill. What is the new stock price.

What is the new fraction of the firm owned by the raider?
 

Answer rating: 100% (QA)

Lets recalculate the new stock price and the new fraction of the firm owned by the raider Given Scra... View the full answer