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One of your close friends is the CEO of a business. She mentioned that her company, Ocean Inc., would like to acquire the ownership of
One of your close friends is the CEO of a business. She mentioned that her company, Ocean Inc., would like to acquire the ownership of a competitor, Sea Corp. whose shares are listed on the NASDQ. The shares are currently trading at $25 per share. Acquisition of the competitor would yield significant synergies as its market presence and products complement the Ocean Inc.'s market presence and products. As a result, this acquisition is a high priority for Ocean Inc. Your friend indicated that Ocean Inc. is finalizing its offer to purchase the shares of Sea Corp. It is currently contemplating an offer of $27.50. Your friend asked your opinion regarding the price being contemplated. How would you respond
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