[Solved] QUESTION: Companies A and B are valued as follows: For Firm A number of shares 2,000, earnings per share $10, and share price $100. The corresponding
QUESTION: Companies A and B are valued as follows: For Firm A number of shares 2,000, earnings per share $10, and share price $100. The corresponding figures for firm B are 1,000, $10, and $50. Company A now acquires B by offering one (new) share of A for every two shares of B (that is, after the merger, there are 2,500 shares of A outstanding). If investors are aware that there are no economic gains from the merger, what is the price-earnings ratio of A's stock after the merger? (1 decimal)
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![[See Steps] QUESTION: The following data on](/images/solutions/MC-solution-library-77963.jpg "[See Steps] QUESTION: The following data on a merger are given:")
[See Steps] QUESTION: The following data on a merger are given:
![[See Solution] Ms. Newcastle has $60,000 income](/images/solutions/MC-solution-library-77964.jpg "[See Solution] Ms. Newcastle has $60,000 income this year and $40,000")
[See Solution] Ms. Newcastle has $60,000 income this year and $40,000
(Solved) QUESTION: The following data on a merger are given: Firm
![[Solution Library] QUESTION: What was the situation](/images/solutions/MC-solution-library-77966.jpg "[Solution Library] QUESTION: What was the situation that led to Mindtree")
[Solution Library] QUESTION: What was the situation that led to Mindtree
(See Solution) QUESTION: What anti-takeover defences did Mindtree
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