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Harrods PLC has a market value of 150 million and 9 million shares outstanding. Selfridge Department Store has a market value of 68 million and
Harrods PLC has a market value of 150 million and 9 million shares outstanding. Selfridge Department Store has a market value of 68 million and 12 million shares outstanding. Harrods is contemplating acquiring Selfridge. Harrods' CFO concludes that the combined firm with synergy will be worth 312 million, and Selfridge can be acquired at a premium of 34 million. If Harrods offers 14 million shares of its stock in exchange for the 12 million shares of Selfridge, what will the stock price of Harrods be after the acquisition? What exchange ratio between the two stocks would make the value of a stock offer equivalent to a cash offer of 90 million
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