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Sussex Foods (SF) and Sussex Grocery (SG) are negotiating a friendly merger of SG by SF. The management teams at both companies have tentatively agreed

Sussex Foods (SF) and Sussex Grocery (SG) are negotiating a friendly merger of SG by SF. The management teams at both companies have tentatively agreed upon a transaction value of about $27 per share for SG's stock, but are presently negotiating alternative methods of payment. You work for the investment banking firm representing SF, and has compiled the data in the following figure to analyze the transaction. Merger Evaluation Inputs Calculate the post-merger value of the combined firm, gains accrued to the target, and gains accrued to the acquirer under the following scenarios: Case 1: Cash offer of $27 per share for Sussex Grocery's stock. Case 2: Stock offer of 0.75 shares of Sussex Foods' stock per share of Sussex

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