Question 3 a. Merger and acquisition have been described as a phenomenon driven by extreme greed that destroys employment and creates social problem. However, in academic circles and especially in the investment banking world, merger and acquisition is seen as a socially and economically beneficial act of dislodging incompetent management. Briefly discuss with relevant example TWO (2) financial reasons used to justify acquisition. (6 Marks) b. Take into consideration the following information regarding two companies that are 100% owned by their shareholders, Lily Berhad (Lily) and Jasmine Berhad (Jasmine): Lily Shares outstanding 500,000 unit EPS P/E ratio RM5.00 10 Jasmine 100,000 unit RM4 5 Lily estimates that the value of the synergistic benefit from acquiring Jasmine is RM30,000. Lily offers its 10% of unit shares outstanding to Jasmine's shareholders to acquire Jasmine. From the information given, you are required to answer the following questions. i. Determine the Net Present Value (NPV) for acquiring Jasmine. (2 Marks) ii. Based on NPV in part (b)(i), should Lily acquire Jasmine? Explain your answer. (2 Marks) (Total: 10 Marks)