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I need solution urgently Question 2 (a) Briefly define and discuss the following theories on the merger and acquisition phenomena: i. Synergy hypothesis Agency theory

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Question 2 (a) Briefly define and discuss the following theories on the merger and acquisition phenomena: i. Synergy hypothesis Agency theory (e.g., Hold-up problems) (b) What are the main objectives of horizontal acquisitions, vertical acquisitions and conglomerate acquisitions respectively? (c) The Company Oriental Express is investigating a possible merger with Company EuroToys. The below is the basic financial information about the two companies: Price per share Number of shares outstanding Oriental Express $3 50 million Euro Toys $2 27,5 million Both Oriental Express and Euro Toys are mature firms. The market value of the merged firm will be $225 million. Oriental Express plans to pay Euro Toys $64 million for the merger. i. ii. mi iv. What is the synergy of the merger? Where does the synergy come from? What is the cost to Oriental Express? What are the gain and stock price change of Oriental Express? What are the gain and stock price change of Euro Toys? V. (a) Brietly define and discuss the following theories on the merger and quisition promena: 1 Syurgy hypothes Agency theory (e 9. Hold-up problems) Bmarks (b) What are the main objectives of horizontal acquisitions, vertical acquisitions and conglomerate acquisitions respectively The Company Oriental Express is investigating possible merger with 15 mars Company Eurotoys. The below is the basic financial information about the TWO companies Orinntal para Duro Toys Trice per share 3 52 Number of shares So milion 27.5 million outstanding Both Oriental Express and Eurotoys are mature firma. The market value of The merged nim will be $225 million Oriental Express plans to pay CureToys 364 million for the merger i. What is the synergy of the merger? 5 marks Where does the synergy come from? 5 marks What is the cost to Oriental Express? 5 marks iv. What are the gain and stock price change of Oriental Express? 6 marks What are the gain and stock price change of Eurotoya? 6 marks Total 50 marks

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