The King Mining Company is contemplating a cash tender offer for the outstanding shares of Queen Coal Corporation. Queen Coal is expected to provide P175,000 in after-tax cash flow each year for the next 20 years. In addition, Roanoke has a P400,000 tax loss carryforward which King Solomon Mining can use over the next two years (P200,000 per year).

King Mining is considering to offer Queen a single payment of P50 million If King Mining's corporate tax rate is 35% and its cost of capital is 12%, should the merger be undertaken?