Two companies, KAPPA and PI consider merging in order to undertake a new project. Both companies are

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Two companies, KAPPA and PI consider merging in order to undertake a new project.

Both companies are totally equity financed, and the new project will also be equity financed. What will be the market value of the combined company, KAPPA–PI, and its new beta value, given the following information?

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Financial Management And Real Options

ISBN: 259088

1st Edition

Authors: Jack Broyles

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Question Posted: May 22, 2024 05:03 AM

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Two companies, KAPPA and PI consider merging in order to undertake a new project. Both companies are

Question:

Kappa Pi Project Market value ( millions) 6.54 14.23 Beta (without project) 1.1 0.90 Beta of project 1.30 NPV of project 3.60

Step by Step Answer:

Financial Management And Real Options

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