Question 4 20 Marks Company X and Company Y are considering a merger. As part of the merger, Company Y is exchange one-for-one basis its shares of company X. The exchange ratio is based on the market prices of Company X and Company Y. The market data of the two companies are provided below: Market Data Company X Company Y Net income (R) 45 000 65 000 Shares outstanding 8 000 2 000 Earnings per share (R) 5.5 3.5 P/E Ratio 9 15 Market price (R) 46 46 4.1. Differentiate between business takeover and merging, also provide South African examples with justification for your answers. (6) 4.2. Justify the wealth maximization rationale for using merger and acquisition as drivers? (4) 4.3. Based on the above data, should Company X and Company Y merge