QUESTION TWO (25 MARKS) Northern Corp and Ipoh Corp are all-equity firms. Northern Corp has 7,000 shares outstanding at a market price of RM60 a share. Ipoh Corp has 3,500 shares outstanding at a price of RM30 a share. Northern Corp is acquiring Ipoh Corp for RM110,000 in cash. The incremental value of the acquisition is RM21,000. i) What is the net present value of acquiring Ipoh Corp to Northern Corp? (5 marks) ii) What is the price per share of Northern Corp after the acquisition? (5 marks) iii) What is the value of the merged firm? (5 marks) iv) If Northern Corp acquires Ipoh Corp for RM103,500 worth of Ipoh Corp's stock, how many new shares of stock will be issued to complete this acquisition? (5 marks) v) Discuss TWO circumstances where stock financing is preferable to cash financing from a bidder's perspective. (5 marks) QUESTION TWO (25 MARKS) Northern Corp and Ipoh Corp are all-equity firms. Northern Corp has 7,000 shares outstanding at a market price of RM60 a share. Ipoh Corp has 3,500 shares outstanding at a price of RM30 a share. Northern Corp is acquiring Ipoh Corp for RM110,000 in cash. The incremental value of the acquisition is RM21,000. i) What is the net present value of acquiring Ipoh Corp to Northern Corp? (5 marks) ii) What is the price per share of Northern Corp after the acquisition? (5 marks) iii) What is the value of the merged firm? (5 marks) iv) If Northern Corp acquires Ipoh Corp for RM103,500 worth of Ipoh Corp's stock, how many new shares of stock will be issued to complete this acquisition? (5 marks) v) Discuss TWO circumstances where stock financing is preferable to cash financing from a bidder's perspective