2. 26.2 Share mergers and EPS Consider the following information for two all-equity firms, Firm A and

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2. 26.2 Share mergers and EPS Consider the following information for two all-equity firms, Firm A and Firm B:

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Firm A is acquiring Firm B by exchanging 100 of its shares for all the shares in Firm B. What is the cost of the merger if the merged firm is worth $63 000? What will happen to Firm A’s EPS? Its PE ratio?

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Fundamentals Of Corporate Finance

ISBN: 9781743768051

8th Edition

Authors: Stephen A. Ross, Rowan Trayler, Charles Koh, Gerhard Hambusch, Kristoffer Glover, Randolph W. Westerfield, Bradford D. Jordan

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Question Posted: Oct 04, 2024 04:04 AM

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2. 26.2 Share mergers and EPS Consider the following information for two all-equity firms, Firm A and

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Firm A Firm B Total earnings $3000 $1100 Shares outstanding 600 400 Price per share $ 70 $ 15

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Fundamentals Of Corporate Finance

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