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Mighty soft Ltd. plans to acquire Techwire Ltd by offering its shares as compensation to the shareholders of Techwire Ltd... The Following information is provided:

Mighty soft Ltd. plans to acquire Techwire Ltd by offering its shares as compensation to the shareholders of Techwire Ltd... The Following information is provided:

For the FY 18-19 (ending 31st March)

Techwire Limited

Mighty soft Limited

Profit after tax (Rs. million)

16,155

25,241

Equity Shares Outstanding (million shares)

218

191

P/E ratio

18

14.6

Shareholders Equity (Rs. Million)

63,502

75,866

Required:

i) Determine the number of equity shares to be issued by Mighty soft for the acquisition of Techwire using the Share Exchange Ratio based on

a) MPS v b) EPS c) Book Value

ii) What is the EPS of Techwire Ltd. after the acquisition under the above share exchange plans if no synergies are expected?

iii) If Mighty soft decides to offer 20% premium to Techwire and the payment is done in 50% cash and 50% stock, what will be EPS of Mighty soft if no synergies are expected.

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