#$1.$ Tiger Corp. has $2$ large divisions that we will refer to as division A and division $B.$ As

stand$-$alone divisions, analysts estimate that division $A$ is worth $$110$ million and division $B$ is

worth $$60$ million. However, because of negative synergies, Tiger's equity is currently valued by

the market at $$150$ million. Tiger has $2,000,000$ shares outstanding.

$($a$)$ If Tiger's management unexpectedly announces that they are spinning off division B$,$ by how

much would you expect the stock price to change when this news is released?

$($b$)$ The spinoff is structured to shareholders of Tiger receive $1$ share of division B stock for each

$2$ shares of Tiger Corp. they currently hold. They also get to keep their shares in Tiger Corp.

following the spinoff of division B$.$ The day after the spinoff is completed, what would you

predict the market price will be for $($i$)$ a share of Tiger stock, and $($ii$)$ a share in the now

independent division $B?$