U Company is considering the acquisition of E Company. E Company has 1,020,000 shares of stock, with earnings per share of $4.50 and a market price per share of $80. U Corporation has 1,565,000 shares outstanding with earnings per share of $6.00 and a market price of $55. The merger is expected to increase net income of the combined companies by $2,600,000 (in synergistic benefits). What is the maximum exchange ratio U Company can offer and what is the minimum exchange ratio E Company can accept?

Hi tutor, please im confused about how to solve this question and have no idea how to use the P/E ratio to solve this. i got 1.09 as my maximum exchange(guess my answer is wrong). i'll like an explanation to better my understanding. thanks