Question
AB Limited is studying the possible acquisition of CD Ltd. by way of a merger. The following data is available. Particulars AB Ltd CD Ltd
AB Limited is studying the possible acquisition of CD Ltd. by way of a merger. The following data is available.
| Particulars | AB Ltd | CD Ltd |
| ProfitsafterTax (PAT) | INR 60,00,000 | INR 10,00,000 |
| No. of equity shares | 10,00,000 | 2,00,000 |
| Market value per share | INR 200 | INR160 |
If the merger goes through and the exchange ratio is based on current market prices, what is the new EPS for AB Ltd.?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
The detailed answer for the above question is provided below If the exchange ratio is b...
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Fundamentals of Financial Management
Authors: Eugene F. Brigham, Joel F. Houston
12th edition
978-0324597714, 324597711, 324597703, 978-8131518571, 8131518574, 978-0324597707
