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Calculate the gain to the merger

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Reference no: EM133058161

Firm B has current value of $500 and seeks to acquire Firm T with a current market value of $100. The financial manager of Firm B believes that the two firms combined would be valued at $650.

  1. Calculate the gain to the merger
  2. Calculate the NPV of the merger if Firm B offers $110 for Firm T
  3. Discuss the distribution of gains if Firm T will only accept an offer of $150

 

Reference no: EM133058161

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