Loki, Inc. and​ Thor, Inc. have entered into a​ stock-swap merger agreement whereby Loki will pay a 39% premium over​ Thor's pre-merger price. If​ Thor's pre-merger price per share was $42 and​ Loki's was $51​, what exchange ratio will Loki need to​ offer? a. 1.42 shares of Loki for each share of Thor b. 0.72 shares of Loki for each share of Thor c. 0.86 shares of Loki for each share of Thor d. 1.14 shares of Loki for each share of Thor

4. The following table shows pre-merger data for ABC Company and XYZ, Inc.     ABC XYZ No of share outstanding 2,000,000 5,000,000 EPS $2.50 $4.00 Price per share $15.00 $60   a) Assume XYZ is taking over ABC by issuing one of its shares for four shares of ABC.  If there is no synergy, what would be the post-merger share price of XYZ? What would be the NPV of the merger? b) Assume there is synergy value of $4,200,000 created from the merger.  What would be the post-merger price per share of XYZ? What would be the NPV of the merger?           5. Lazos Company is in distress mainly due to its failure to adopt the current technology.  Creditors took Lazos to bankruptcy court and Lazos is fighting for a reorganization.  The following is its condensed balance sheet.   Book Value Market Value Current assets             $   120,000.00  $     100,000.00  Machinery                         200,000.00            150,000.00  Other fixed…

Mammoth Inc. is acquiring Snail Ltd. Mammoth's share price is $50 and Snail's share price is $10. Both firms have 1 million shares outstanding. Mammoth expects a discounted synergistic value of $5 million from the merging of operations of the two firms. If Mammoth pays cash of $11.5 million to Snail's shareholders, what is the value of the merged firm?   $68.5 million   $65.0 million   $60.0 million   $63.5 million

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