Vtech Metal has earnings per share of $2. It has 10 million shares outstanding and is

trading at $20 per share. Vtech Metal is thinking of buying Nissin Steel, which has

earnings per share of $1.25, 4 million shares outstanding, and a price per share of

$15. Vtech Metal will pay for Nissin Steel by issuing new shares. There are no

expected synergies from the transaction.

If Vtech offers an exchange ratio such that, at current pre-announcement share

prices for both firms, the offer represents a 20% premium to buy Nissin Steel,

calculate the price per share of the combined corporation after the merger.