QUESTION 5 a) Upen Bhd. is planning to acquire Ipen Corp. Assume that both firms have no debt outstanding. Upen Bhd. has estimated that the incremental value from acquiring Ipen Corp. is RM20,000. Consider the following pre-merger information: No. of share outstanding Market price per lot Upen Bhd. 1,600 units RM2,500 Ipen Corp. 1,000 units RM1,500 If Ipen Corp. can be acquired for RM20 a share in cash, estimate: i) net Present Value (NPV) of the acquisition to Upen Bhd. (3 marks) ii) the total merger premium. (2 marks) iii) Upen's share selling price after the acquisition. (3 marks) iv) the price per share of the acquisition to Upen if it uses one of its shares for every four of Ipen's shares to merge. (4 marks) v) the Net Present Value (NPV) of the acquisition, assuming the condition in (iv). (3 marks) QUESTION 5 a) Upen Bhd. is planning to acquire Ipen Corp. Assume that both firms have no debt outstanding. Upen Bhd. has estimated that the incremental value from acquiring Ipen Corp. is RM20,000. Consider the following pre-merger information: No. of share outstanding Market price per lot Upen Bhd. 1,600 units RM2,500 Ipen Corp. 1,000 units RM1,500 If Ipen Corp. can be acquired for RM20 a share in cash, estimate: i) net Present Value (NPV) of the acquisition to Upen Bhd. (3 marks) ii) the total merger premium. (2 marks) iii) Upen's share selling price after the acquisition. (3 marks) iv) the price per share of the acquisition to Upen if it uses one of its shares for every four of Ipen's shares to merge. (4 marks) v) the Net Present Value (NPV) of the acquisition, assuming the condition in (iv)