Keycorp Corporation is acquiring Lucent Technologies Corporation for $563,000 in cash. Keycorp has 19,200 shares of stock outstanding at a market value of $37.60 a share. Lucent Technologies has 17,500 shares of stock outstanding at a market price of $28 a share. Neither firm has any debt. The net present value of the acquisition is $42,000. What is the price per share of Keycorp after the acquisition?
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$43.08 |
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$41.27 |
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$40.53 |
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$39.79 |
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$38.26 |
Price = price key corp*shares key corp+NPV of deal)/shares keycorp
=(37.6*19200+42000)/19200
=39.79
Keycorp Corporation is acquiring Lucent Technologies Corporation for $563,000 in cash. Keycorp has 19,200 shares of...
Atlas Corporation is acquiring Bazan, Inc. for $1,670,000 in cash. Atlas has 80,000 shares of stock outstanding at a market value of $55 a share. Bazan has 38,000 shares of stock outstanding at a market price of $39.60 a share. Neither firm has any debt. The net present value of the acquisition is $182,000. What is the price per share of Atlas after the acquisition? $57.28 $56.13 $55.44 $54.21 $58.04
Alpine Corporation is acquiring Beckshire Company for $302,000 in cash. Alpine has 15,000 shares of stock outstanding at a market value of $34 a share. Berkshire has 12,000 shares of stock outstanding at a market price of $23 a share. Neither firm has any debt. The net present value of the acquisition is $51,000. What is the price per share of Alpine after the acquisition? $38.15 $37.40 $36.20 $39.27 $40.15
2. POST ACQUISITION VALUE CPI, Inc. is acquiring JW for R470 000 in cash. CPI has 27 000 shares outstanding at a market value of R320 a share. JW has 32 000 shares outstanding at a market price of R140 a share. Neither firm has any debt. The synergy value of the acquisition is R18 000. What is the value of CPI after the acquisition? 3. NUMBER OF NEW SHARES TO BE ISSUED FOR ACQUISITION GM Corporation is being acquired by BKF Ltd. for...
Tuesday's and Thursday's are all-equity firms. Tuesday's has 5,600 shares outstanding at a market price of $28 a share. Thursday's has 4,500 shares outstanding at a price of $42 a share. Thursday's is acquiring Tuesday's. The incremental value of the acquisition is $4,200. What is the value of Tuesday's to Thursday's? Multiple Choice $161,000 $165,400 $152,600 $156,800 $130,200
Hastings Corporation is interested in acquiring Vandell Corporation. Vandell has 1 million shares outstanding and a target capital structure consisting of 30% debt; its beta is 1.40 (given its target capital structure). Vandell has $10.71 million in debt that trades at par and pays an 7.5% interest rate. Vandell’s free cash flow (FCF0) is $1 million per year and is expected to grow at a constant rate of 5% a year. Both Vandell and Hastings pay a 35% combined federal...
Hastings Corporation is interested in acquiring Vandell Corporation. Vandell has 1 million shares outstanding and a target capital structure consisting of 30% debt; its beta is 1.50 (given its target capital structure). Vandell has $10.81 million in debt that trades at par and pays an 7.5% interest rate. Vandell’s free cash flow (FCF0) is $2 million per year and is expected to grow at a constant rate of 4% a year. Both Vandell and Hastings pay a 35% combined federal...
Hastings Corporation is interested in acquiring Vandell Corporation. Vandell has 1 million shares outstanding and a target capital structure consisting of 30% debt; its beta is 1.50 (given its target capital structure). Vandell has $8.23 million in debt that trades at par and pays an 7.2% interest rate. Vandell’s free cash flow (FCF0) is $2 million per year and is expected to grow at a constant rate of 4% a year. Both Vandell and Hastings pay a 40% combined federal...
Hastings Corporation is interested in acquiring Vandell Corporation. Vandell has 1 million shares outstanding and a target capital structure consisting of 30% debt; its beta is 1.50 (given its target capital structure). Vandell has $9.48 million in debt that trades at par and pays an 7.7% interest rate. Vandell’s free cash flow (FCF0) is $1 million per year and is expected to grow at a constant rate of 6% a year. Both Vandell and Hastings pay a 30% combined federal...
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