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1. High Tech is acquiring Low Tech for $647,000 in cash. High Tech has 35,000 shares of stock outstanding at a market value of $40 a share. Low Tech has 20,000 shares of stock outstanding at a market price of $31 a share. Neither firm has any debt. The net present value of the acquisition is $50,000. What is the price per share of High Tech after the acquisition?

$40.16

$41.43

$42.39

$43.70

$44.56

2. Cadillac, Inc. is acquiring Cheapskate, Inc. for $685,000 in cash. Cadillac has a current market value of $1,200,000 while Cheapskate s current market value is $650,000. The synergy value from the acquisition is $100,000. What is the value of Cadillac, Inc. after the acquisition?

$1,265,000

$1,298,000

$1,327,000

$990,000

$1,175,000

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92856702

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