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What would be the post-merger share price of xylon

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Reference no: EM132968833

Question - The following table shows pre-merger data for Kiya Company and Xylon, Inc. Kiya Xylon No of share outstanding 1,000,000 5,000,000 EPS $2.50 $4.00 Price per share $20.00 $50.

a) Assume Xylon is taking over Kiya by issuing one of its shares for two shares of Kiya. If there is no synergy, what would be the post-merger share price of Xylon?

b) Assume there is synergy value of $2,600,000 created from the merger. What would be the post-merger price per share of Xylon? What would be the NPV of the merger?

Reference no: EM132968833

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