Firm A

Firm B

Shares outstanding



Price per share

$ 40

$ 30

Firm A estimates that the value of the synergistic benefit from acquiring Firm B is $6,000. Firm B has indicated that it would accept a cash purchase offer of $35 per share. Should Firm A proceed?

25.2 Stock Mergers and EPS Consider the following information for two all-equity firms, A and B:

0 0

Post a comment