1 Evaluate the bids by Wrigley and Nestl Based on Hersheys preannouncement stock price (7 24 2002) of $62 50, what were the implied takeover premiums offered by Wrigley and Nestl Are the bids all cash All equity Equity and cash If equity is involved what is the exchange ratio Bidding Companies Financial Data Hershey Wrigley Nestle Cadbury Schwepes Beta 0 55 0 70 0 70 0 60 Credit rating A N A AAA BBB Stock price 9 17 2002 73 8 49 5 51 9 28 5 Shares outstanding (millions) 134 2 225 0 1550 6 502 5 Book value of debt ($ millions) 884 9 0 0 19500 0 3543 0

Question

1  Evaluate the bids by Wrigley and Nestl  Based on Hersheys preannouncement stock price (7 24 2002) of $62 50, what were the implied takeover premiums offered by Wrigley and Nestl  Are the bids all cash  All equity  Equity and cash  If equity is involved what is the exchange ratio  Bidding Companies Financial Data Hershey Wrigley Nestle Cadbury Schwepes Beta 0 55 0 70 0 70 0 60 Credit rating A  N A AAA BBB Stock price 9 17 2002 73 8 49 5 51 9 28 5 Shares outstanding (millions) 134 2 225 0 1550 6 502 5 Book value of debt ($ millions) 884 9 0 0 19500 0 3543 0

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		Bidding Companies Financial Data


	Hershey	Wrigley	Nestle	Cadbury Schwepes
Beta	0.55	0.70	0.70	0.60
Credit rating	A+	N/A	AAA	BBB
Stock price 9/17/2002	73.8	49.5	51.9	28.5
Shares outstanding (millions)	134.2	225.0	1550.6	502.5
Book value of debt ($ millions)	884.9	0.0	19500.0	3543.0

Question

1. Evaluate the bids by Wrigley and Nestl: Based on Hersheys preannouncement stock price (7/24/2002) of $62.50, what were the implied takeover premiums offered by

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