Wagirin.Ltd, a retail company, wants to acquire Sabeni.Ltd, a merchandise company. The value of the acquisition is SG$ 50,000,000 worth of Wagirin.Ltd stocks. The acquisition will bring incremental value as of SG$ 10,250,000. Sabeni.Ltd has 22,000 stocks outstanding with the price of SG$ 2,250 per share. Wagirin.Ltd has stocks outstanding as of 100.000 shares with the price of SG$ 11,000 per share. The negotiation has an actual price paid for the acquisition using company stock as of SG$ 53,500,000.
Required:
1. The value of Sabeni.Ltd for Wagirin.Ltd
2. The net present value of the acquisition.
3. Explain should Wagirin.Ltd acquire Sabeni.Ltd. Give your reason
Already registered? Login
Not Account? Sign up
Enter your email address to reset your password
Back to Login? Click here