In the table below we have figures about the companies B(idder) and Target) as independent entities. Both B and T are fully funded with equity. B acquires T. B pays the stockholders of T with 100,000 new shares of B. The synergy of the acquisition is 0. Assume that B can mislead the market (put differently: the market perceives the P/E ratio of B identical before and after the acquisition). Value of equity P/E ratio Number of Shares Outstanding Price (per share) Total Earnings Earnings per Share B 30,000,000 25 300,000 100 1,200,000 4 T 10,000,000 10 100,000 100 1,000,000 10