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4. Barrison is investigating the possible acquisition of Soulmaster. The two firms have the following basic data: Barrison Number of shares Current stock price 3,000,000

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4. Barrison is investigating the possible acquisition of Soulmaster. The two firms have the following basic data: Barrison Number of shares Current stock price 3,000,000 $75.00 1,200,000 $25.00 The combined firm will result in a synergy gains of $15m. a. What is the value of of the combined firm? b. What is the NPV of acquisition if Barrison pays $30 in cash for each share of Soulmaster? What is the NPV of the acquisition if Barrison offers one share of Barrison for every two shares of Soulmaster? C

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