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EPS and postmerger price Data for Henry Company and Mayer Services are given in the following table, Henry Company is considering merging with Mayer by
EPS and postmerger price Data for Henry Company and Mayer Services are given in the following table, Henry Company is considering merging with Mayer by swapping 1.34 shares of its stock for each share of Mayer stock. Henry Company expects its stock to sell at the same pricelearnings (P/E) multiple after the merger as before merging. a. Calculate the ratio of exchange in market price. b. Calculate the earnings per share (EPS) and pricelearnings (P/E) ratio for each company. C. Calculate the pricelearnings (P/E) ratio used to purchase Mayer Services. d. Calculate the post-merger earnings per share (EPS) for Henry Company. e. Calculate the expected market price per share of the merged firm. EPS and postmeraer price Data for Henry Company and Maver Services are aiven in the following table. Henry Company is considerina meraina with Maver by swapping 1.34 shares of its stock for each share of a. The ratio of exchange in market price is (Round to two decimal places.) Data table b. The EPS for Henry Company is $(Round to the nearest cent.) The EPS for Mayer Services is $ (Round to the nearest cent.) The P/E for Henry Company is (Round to two decimal places.) (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) Item Henry Company Mayer Services Earnings available for common stock $270,000 $40,000 Number of shares of common stock outstanding 80.000 15,000 Market price per share $64 $45 The P/E for Mayer Services is (Round to two decimal places.) C. The P/E used to purchase Mayer Services is . (Round to two decimal places.) d. The post-merger EPS is $. (Round to the nearest cent.) e. The expected market price per share of the merged firm is $1. (Round to the nearest cent.) Print Done
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