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Apple Inc. is contemplating the acquisition of Blackberry Ltd. Information for the two companies is given in the table below. Blackberry has many patents
Apple Inc. is contemplating the acquisition of Blackberry Ltd. Information for the two companies is given in the table below. Blackberry has many patents that would be valuable to Apple. Apple executives estimate that the acquisition would unlock $5.5 billion of additional value. Use this information to answer the question that follows. Value of Debt Apple $0 Market Value of Firm, VU ($8) $500 Shares Outstanding Blackberry $0 $4.00 860M 500M What will the price of the merged firm (Pm) be if Apple offers Blackberry shareholders $5.70 per share in cash and the rest in shares of the merged firm, such that Apple retains 41% of the synergies?
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