Homework SoursePlease show work Bigby is acquiring Samco for 72000 in cash
Please show work
Bigby is acquiring Samco for $72,000 in cash. Bigby has a current market value of $115,000 while Samco s current market value is $67,000. The synergy value from the acquisition is $12,000. What is the value of Bigby after the acquisition?
$122,000
$139,000
$127,000
$183,000
$165,000
| $122,000 | ||
| $139,000 | ||
| $127,000 | ||
| $183,000 | ||
| $165,000 |
Solution
Value of Bigby after the acquisition:
= Independent value of Bigby + Independent value of Samco + Synergy value – Cash paid
= $115,000+$67,000+$12,000-$72,000
= $122,000
