Fin_3000 problem 4

ABC has 1 million shares outstanding, each of which has a price of $24. It has made a takeover offer of XYZ Corporation which has 1 million shares outstanding, and a price per share of $2.39. Assume that the takeover will occur with certainty and all market participants know this. Furthermore, there are no synergies to merging the two firms. a. Assume ABC made a cash offer to purchase XYZ for $5.04 million. What happens to the price of ABC and XYZ on the announcement? What premium over the current market price does this offer represent? b. Assume ABC makes a stock offer with an exchange ratio of 0.21. What happens to the price of ABC and XYZ this time? What premium over the current market price does this offer represent? c. At current market prices, both offers are offers to purchase XYZ for $5.04 million. Does that mean that your answers to parts (a) and (b) must be identical? Explain. a. Assume ABC made a cash offer to purchase XYZ for $5.04 million. What happens to the price of ABC…

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Consider the following premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding. Shares outstanding Price per share Firm B 5,000 $ 42 Firm T 1,600 $17 Firm B has estimated that the value of the synergistic benefits from acquiring Firm T is $9,000. Firm T can be acquired for $19 per share in cash or by exchange of stock wherein B offers one of its share for every two of T's shares. a. Shareholders of Firm T b. Exchange ratio a. Are the shareholders of Firm T better off with the cash offer or the stock offer? b. At what exchange ratio of B shares to T shares would the shareholders in T be indifferent between the two offers? (Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.) to 1

Koko Services, Inc., has just declared a 2-for-1 stock split. The company’s pre-split common stockholders’ equity was as follows: If the pre-split price of common stock was $28.50, what will the new common equity section of the balance sheet look like? Show all of your calculation work and label all of your work so I can follow your calculation process.

For Question 1, 2, and 3, use the following information: 1.) Consider the following premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding.     Firm B   Firm T     Shares outstanding   6,500     1,500     Price per share $ 45   $ 15     Firm B has estimated that the value of the synergistic benefits from acquiring Firm T is $10,600. If Firm T is willing to be acquired for $20 per share in cash, what is the NPV of the merger? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) Please round to the nearest dollar and format as "X,XXX" 2.) Consider the following premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding.    Firm B   Firm T     Shares outstanding   6,500     1,500     Price per share $ 45   $…

Below are 3 questions with answers,  Please give solutions and explanation to the following questions. The correct answer is already given, just provide me with solution. AS PER BARTLEBY, YOU WILL ANSWER THE FIRST THREE QUESTIONS... please, don't answer just one question, it's unfair "The shareholders equity section of N Company at the end of the 2021 and 2020 are as follows: (2019) 10% Preference share, P100 par P1,500,000; Ordinary share, P20 par P1,000,000; Share premium-preference P210,000; Share premium-ordinary P400,000 (2020) 10% Preference share, P100 par P800,000; Ordinary share, P20 par P600,000; Share premium-ordinary P200,000. What is the total number of ordinary shares issued as of December 31, 2021?" Answer: "50,000 shares"     During its first year of operations, TLTH Corporation had the following transactions relating to its ordinary shares: Issued 80,000 shares for cash at P60 per share. Issued 500 shares to lawyers in payment of a bill for P35,000 for services…

Consider the following premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding. Firm B Firm T Shares outstanding Price per share 6,000 1,200 $ 47 $ 17 Firm B has estimated that the value of the synergistic benefits from acquiring Firm T is $9,500. a. If Firm T is willing to be acquired for $19 per share in cash, what is the NPV of the merger? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) b. What will the price per share of the merged firm be assuming the conditions in (a)? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. If Firm T is willing to be acquired for $19 per share in cash, what is the merger premium? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) d. Suppose Firm T is agreeable to a merger by an exchange of stock. If B offers one of its shares for…

Consider the following premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding.   Firm B   Firm T     Shares outstanding   6,400     1,600     Price per share $ 48   $ 19     Firm B has estimated that the value of the synergistic benefits from acquiring Firm T is $8,900. a. If Firm T is willing to be acquired for $21 per share in cash, what is the NPV of the merger? b. What will the price per share of the merged firm be assuming the conditions in (a)? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. If Firm T is willing to be acquired for $21 per share in cash, what is the merger premium? d. Suppose Firm T is agreeable to a merger by an exchange of stock. If B offers one of its shares for every two of T's shares, what will the price per share of the merged firm be? (Do not round intermediate calculations and round your answer to 2…

Need both question. ....don't attempt if you will not solve both questions. .......

Hello. I need help with the following question please. Thank you!

Camel Industries is considering the acquisition of Sugar Limited and has appointed you as an acquisition and merger specialist to evaluate the project. Your task is to assess whether the company should move forward with the takeover.The following market data has been provided for your analysis:Earnings per share: R3.60 for Camel Industries, R2.80 for Sugar LimitedMarket price per share: R8.00 for Camel Industries, R5.00 for Sugar LimitedNumber of shares: 3 million for Camel Industries, 2 million for Sugar LimitedAs per the takeover agreement, Camel Industries will make a cash payment of R15 million to Sugar Limited. The expected synergistic benefits from the acquisition are estimated at R8 million. Your role is to provide guidance on whether the acquisition is a beneficial move for Camel Industries.Required:4.1 Calculate the value of the combined companies4.2 Calculate the net present value of the proposal4.3 Calculate the take-over premium Assume that the take-over is based on an…

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Question # 2:            Which of the following statements is CORRECT? a. If Apple issues additional shares of common stock through an investment banker, this would be a secondary market transaction. b. If you purchased 100 shares of Apple stock from your sister-in-law, this would be an example of a primary market transaction. c. The IPO market is an example of a primary market. d. Question # 3:    Which of the following statements is CORRECT? a. Capital market instruments include both long-term debt and common stocks. b. An example of a primary market transaction would be your uncle transferring 100 shares of Wal-Mart stock to you as a birthday gift. c. The NYSE does not exist as a physical location; rather, it represents a loose collection of dealers who trade stocks electronically. d. If your uncle in New York sold 100 shares of Microsoft through his broker to an investor in Los Angeles, this would be a primary market transaction.…

NEED ALL QUEST.... You would like to purchase one ClassA share of Berkshire Hathaway through your TD Ameritrade brokerage account. TD Ameritrade advertises a $5 commission for trades using their​ phone-based interactive voice response system. You call and learn that the bid price is ​$285,705.59 and the asking price is $285,909.62​ , and you submit your order for one share.   a. The current​ bid/ask spread for Berkshire Hathaway Class A shares is ​$________ ​(Round to the nearest​ cent.)   b. If TD Ameritrade routes your buy order to the​ NYSE, the potential minimum for your total transaction costs is $________ ​(Round to the nearest​ dollar.)   c. If TD Ameritradevroutes your buy order to​ NASDAQ, the potential maximum for your total transaction costs is $________ ​(Round to the nearest​ cent.)   d. Regardless of how your trade is​ executed, based on the​ bid/ask spread, the market value of your trade is $________ ​(Round to the nearest​ cent.)