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How do I calculate the NPV of individual firms and that of the merger using the given information? What other information does it provide about

image text in transcribedimage text in transcribedHow do I calculate the NPV of individual firms and that of the merger using the given information? What other information does it provide about the proposed merger?image text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribed

THE MERGER OF UNION BANK OF SWITZERLAND AND SWISS BANK CORPORATION (A): THE PROPOSED MERGER Summary Term Sheet for the Merger Announcement date December 8, 1997 Consideration Form of payment Exchange ratio Stock ex-UBS Registered shares 1 UBS AG share for each registered share 5 UBS AG shares for each bearer share 1.0769 UBS AG shares for each SBC share 214.37 million shares Bearer shares SBC Number of UBS AG shares to be issued Effective ownership in UBS AG of ex-UBS shareholders SBC shareholders 60% 40% Price Combined market capitalization - Dec. 4, 1997 (CHF m)85,094 No. of UBS AG shares issued (m) Market value per UBS AG share (CHF) 214.37 396.95 Ratio to SBC shareholders Value to SBC shareholders (exchange ratio times UBS AG market value per share) (CHF) SBC share price on December 4, 1997 (merger was announced December 8, 1997) (CHF) Implied premium / discount 1 & 1/13 427.5 431 -0.82% Ratio to ex-UBS bearer shareholders Value to ex-UBS bearer shareholders (exchange ratio times 1,984.7 UBS AG market value per share) (CHF) ex-UBS bearer share price on December 4, 1997 (merge1,891.0 was announced December 8, 1997) (CHF) Implied premium discount 4.96% Ratio to UBS registered shareholders Value to UBS registered shareholders (exchange ratio times UBS AG market value per share) (CHF) 396.95

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