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You work for a leveraged buyout firm and are evaluating a potential buyout of UnderWater Company.? UnderWater's stock price is $23 and it has 1.25 million shares outstanding.You believe that if you buy the company and replace its? management, its value will increase by 37%.

You are planning on doing a leveraged buyout of UnderWater and will offer $28.75 per share for control of the company.

a. Assuming you get 50% ?control, what will happen to the price of? non-tendered shares?

b. Given the answer in part

?(a?) will shareholders tender their? shares, not tender their? shares, or be? indifferent?

c. What will your gain from the transaction? be?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92429555

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