Zhen Yee Electronics Ltd is considering the acquisition of Datamatic Ltd at a cash price of $5,000,000. Datamatic Ltd has short-term liabilities of $2804069 that Zhen Yee would have to pay immediately. As a result of the acquisition, Zhen Yee would acquire the rights to Datamatic's patent, providing an estimated cash inflow of $1,992,386 per year for the next 8 years. The cost of capital for the acquisition is 12%. What would be the net present value of the merger? (Please do not use $ or , when entering your answer.)

Answer rating: 100% (QA)

To calculate the net present value NPV of the merger we need to discoun... View the full answer