Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

complete last part of the question. it is not $20 per share Question Help BAD Company's stock price is $40, and it has 120 million

complete last part of the question. it is not $20 per share image text in transcribed
Question Help BAD Company's stock price is $40, and it has 120 million shares outstanding. You believe that you buy the company and replace to management its value wil increase by 38%. Assume that BAD has a poison with a 25% trigger. If triggered, al target shareholders other than the acquire will be able to buy one new share in BAD for each share they own at a 50% discount Assume that the price remains at $40 while you are acquiring your shares. I BAD's management decides to resist your buyout attempt, and you cross the 28% threshold of ownership How many new shares will be issued and at what price? b. What will happen to your percentage ownership of BAD? c. What will happen to the price of your shares of BAD? d. Do you lose or gain from triggering the polson pl? if you low, where does the loss go (who benetesy of you gain, where does the pain come from (who komen? a. How many new shares will be issued and at what price? Number of new shares issued is 1000000 Pound to the nearest Integer The shares will be wewed at $ 20 per share. (Round to the nearest cont.) b. What will happen to your percentage ownership of BAD CO.? The percentage ownership will be 14.28%. Round to two decimal places) c. What will happen to the price of your shares of BAD CO? The new stock price will be $3142. Round to two decimal places) d. Do you lose or gain from triggering the polson pill? Tre gain (low -28.710.000 (Round to the nearest doiter, poslive it goin, negative foss, coronether) If you lose, where does the loss go (who beats)? t you gain, where does the gain come from (who losos)? Every other shareholder in the target firm gaina $ 20 per share (Round to the nearest cent) Enter your answer in the answer box and then click Check

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Intermediate Financial Management

Authors: Eugene F Brigham, Phillip R Daves

9th Edition

032431986X, 9780324319866

More Books

Students also viewed these Finance questions