Wonda Inc aims to acquire Ovaltime Ltd in the near future. As an analyst, you have compiled the data as follows: As per the table is shown above, calculate the following: a) of shares to be issued by the acquirer
Wonda Inc aims to acquire Ovaltime Ltd in the near future. As an analyst, you have compiled the data as follows: As per the table is shown above, calculate the following: a) of shares to be issued by the acquirer
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Wonda Inc aims to acquire Ovaltime Ltd in the near future. As an analyst, you have compiled
the
data as follows:
As per the table is shown above, calculate the following:
a) of shares to be issued by the acquirer
b) Post-merger EPS
c) Post-merger P/E if market is efficient
d) Post-merger P/E if market is not efficient
e) One-day after the M&A process, the new company stock price becomes Rm 10, with 3-
month T-bills 5%, bursa Malaysia return was 12% with risk premia of 0.8. Is there any
abnormal return from the M&A Process? Prove it.
Transcribed Image Text:Share Price
Revenue
Net Profit Margin
Outstanding Shares
Wonda Inc
20
5000000
20%
100000
Ovaltime Ltd
6
1000000
15%
100000
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