1) Prodigy Corp. has a market value of equity of $45 million, and 10 million shares outstanding. Epitome Inc. has a stand-alone market value of equity of $18 million, and 8 million shares outstanding. Prodigy Corp. is contemplating acquiring Epitome Inc. M&A specialists have helped Prodigy estimate the following projections for the synergies expected in the merger with Epitome Inc.: Incremental annual cash flows from synergies in the first year after the merger = $393,750 Constant growth rate in the synergy cash flows beyond the first year = 5% Discount rate for the synergy cash flows = 9.5% a) What is the value of the synergies expected from the merger? b) What is the merger value of Epitome's equity to Prodigy Corp.? () How many shares of stock should Prodigy offer the shareholders of Epitome Inc., if they want to structure a stock offer that has a cash value of $21,525,000