Company C merge With company D Company C shares = $17, 6 mill outstanding Company D shares = $5, 2 mill outstanding Synergies from merge = $4 mill OFFER = COmpany C offers 1 of own share for 3 of Company D shares Find NPV for company C if accepted
Company C merge With company D Company C shares = $17, 6 mill outstanding Company D shares = $5, 2 mill outstanding Synergies from merge = $4 mill OFFER = COmpany C offers 1 of own share for 3 of Company D shares Find NPV for company C if accepted
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
Problem 1PS
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Question
Company C merge With company D
Company C shares = $17, 6 mill outstanding
Company D shares = $5, 2 mill outstanding
Synergies from merge = $4 mill
OFFER = COmpany C offers 1 of own share for 3 of Company D shares
Find
Expert Solution
Step 1
Companies acquire other companies to be benefitted from the merger due to similarities between the two companies and due to their income and profit increases.
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