Company A Acquires Company B Synergy benefits = $600 Mill Offer to company B shareholders: Company A  gives 5 shares for 3 of company B shares Company A shares = $25 for 110mill outstanding Company B Shares = $30 for 60mill outstanding Value of combined company?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Company A Acquires Company B

Synergy benefits = $600 Mill

Offer to company B shareholders: Company A  gives 5 shares for 3 of company B shares

Company A shares = $25 for 110mill outstanding

Company B Shares = $30 for 60mill outstanding

Value of combined company?

 

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