Digery Inc. and Braggety Inc. are two arm’s length corporations who plan to amalgamate. Each corporation has only common shares outstanding. The common shares of Digery have a PUC and ACB of $600 and the company is worth approximately $20,000. Braggety Inc. common shares have a PUC and ACB of $1,200 and the company is worth approximately $80,000. If 200 common shares of the amalgamated company are issued, how many will Braggety’s shareholders receive on amalgamation? What will be the ACB of the shares received by Braggety’s shareholders?
Digery Inc. and Braggety Inc. are two arm’s length corporations who plan to amalgamate. Each corporation has only common shares outstanding. The common shares of Digery have a PUC and ACB of $600 and the company is worth approximately $20,000. Braggety Inc. common shares have a PUC and ACB of $1,200 and the company is worth approximately $80,000. If 200 common shares of the amalgamated company are issued, how many will Braggety’s shareholders receive on amalgamation? What will be the ACB of the shares received by Braggety’s shareholders?
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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Digery Inc. and Braggety Inc. are two arm’s length corporations who plan to amalgamate. Each corporation has only common shares outstanding. The common shares of Digery have a PUC and ACB of $600 and the company is worth approximately $20,000. Braggety Inc. common shares have a PUC and ACB of $1,200 and the company is worth approximately $80,000. If 200 common shares of the amalgamated company are issued, how many will Braggety’s shareholders receive on amalgamation? What will be the ACB of the shares received by Braggety’s shareholders?
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