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Consider the following premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding.

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Consider the following premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding. Firm B Firm T Shares outstanding 6,400 1,600 Price per share $ 48 $ 19 Firm B has estimated that the value of the synergistic benefits from acquiring Firm T is $8,900 a. If Firm T is willing to be acquired for $21 per share in cash, what is the NPV of the merger? b. What will the price per share of the merged firm be assuming the conditions in (a)? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. If Firm T is willing to be acquired for $21 per share in cash, what is the merger premium? d. Suppose Firm T is agreeable to a merger by an exchange of stock. If B offers one of its shares for every two of T's shares, what will the price per share of the merged firm be? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) e. What is the NPV of the merger assuming the conditions in (d)? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) a. If Firm T is willing to be acquired for $21 per share in cash, what is th merger? b. What will the price per share of the merged firm be assuming the conditi (a)? (Do not round intermediate calculations and round your answer to places, e.g., 32.16.) c. If Firm T is willing to be acquired for $21 per share in cash, what is the m premium? d. Suppose Firm T is agreeable to a merger by an exchange of stock. If B its shares for every two of T's shares, what will the price per share of the be? (Do not round-intermediate calculations and round your answer to places, e.g., 32.16.) e. What is the NPV of the merger assuming the conditions in (d)? (Do not intermediate calculations and round your answer to 2 decimal places a. NPV b. Price per share c. Merger premium d. Price per share NPV e

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