Assume that there are no synergistic benefits as

QUESTION

8. Apex Corporation is considering the purchase of Pinnacle Company in a stock for stock exchange. Selected data on the two companies are shown in the following table: Assume that there are no synergistic benefits as the result of the merger. Determine EPS for the combined company if Apex offers a a. 20 percent premium for Pinnacle b. 40 percent premium for Pinnacle c. 50 percent premium for Pinnacle 9. Consider problem 8 again. Assume that there are immediate synergistic benefits of $4 million if Apex and Pinnacle merge. Answer parts a, b, and c of problem 8 under these conditions. a. 20 percent premium b. 40 percent premium c. 50 percent premium

ANSWER

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