Question
Tiger LLC has market value of $96 million and 600,000 shares outstanding. Momcut Department Store has market value of $24 million and 400,000 shares outstanding.
Tiger LLC has market value of $96 million and 600,000 shares outstanding. Momcut Department Store has market value of $24 million and 400,000 shares outstanding. Tiger is contemplating acquiring Momcut. Tiger's CFO concludes that the combined firm with synergy will be worth $131 million, and Momcut can be acquired at a price of $27 million. If Momcut is acquired by cash, what is the NPV of the merger?
Group of answer choices
$3 million
$24 million
$8 million
$11 million
$14 million
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Equity Valuation And Portfolio Management
Authors: Frank J. Fabozzi, Harry M. Markowitz
1st Edition
047092991X, 9780470929919
