Question
TrippleChocolate and Kakao Inc have decided to merge. Before announcement, TrippleChocolate was trading at $11.23 and had 15M shares outstanding and $50M debt, while Kakao
TrippleChocolate and Kakao Inc have decided to merge. Before announcement, TrippleChocolate was trading at $11.23 and had 15M shares outstanding and $50M debt, while Kakao Inc was trading at $121.5 and had 11M shares outstanding, while carrying $100M debt. The two companies plan to create a total value of synergies of $700M, net of any potential implementation costs. Kakao Inc has decided to offer TrippleChocolate 30% of synergies as an acquisition premium. At what price would Kakao Inc buy shares of TrippleChocolate?
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