ratio 4 30 Shares outstanding 48‚000 160‚000 Earnings 360‚000 720‚000 a) What will EPS of Weber Inc. be after the merger? Merger for 3/4 of weber. EPS =$720‚000 + $360‚000/[160‚000 + (3/4) × 48‚000]= $5.51 b) What is the stock price of Weber Inc. before the merger? Stock price = PE ratio × EPS = 30×$720‚000/160‚000 = $135 c) What will the PE ratio be if the NPV of the acquisition is zero? The market price of Weber Inc. will remain unchanged
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After the merger‚ both the Oracle and PeopleSoft share prices rose by 10%. One of such benefits is increased capital base of the new company. Before the merger‚ the revenues of Oracle ad PeopleSoft were $10.2 billion and 3 billion respectively. The merger of these two companies would enhance the revenue base of the new company. This made Oracle to gain an advantage in relation to market capitalization in relation to its competitors. In line with the objective of the merger‚ the size of these
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CHAPTER 1 INTRODUCTION 1.0 Introduction Merger and acquisition activity results in overall benefits to shareholders when the consolidated post-merger firm is more valuable than the simple sum of the two separate pre-merger firms. The primary cause of this gain in value is supposed to be the performance improvement following the merger. The research for post-merger performance gains has focused on improvements in any one of the following areas such as
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M&A Motives There are two types of motives involved in merger and acquisition and these are Explicit and Implicit motives. Explicit Motives • Synergy: Synergy means that the merged firm will have a greater value than the sum of its parts as a result of enhanced revenues and the cost base. • Economies of Scale: Economic of scale refer to the reduction in unit cost achieved by producing a large volume of a product. Horizontal mergers aim at achieving economies of scale. This phenomenon continues
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MJacob Bliberg (jb3975@stern.nyu.edu) Jasper Buntinx (jasper@buntinx.eu) April 2013 Post-Acquisition Report Teva Pharmaceutical Industries Ltd. (NASDAQ: TEVA) $6.8Bn acquisition of Cephalon‚ Inc. (NASDAQ: CEPH) – October 14‚ 2011 | Teva Pharmaceutical Industries Ltd. (NASDAQ: TEVA) is a leading global pharmaceutical company which develops‚ produces and markets affordable generic drugs. Teva is the world’s largest generic drug maker‚ with a direct presence in about 60 countries. Teva’s
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FINANCE 2 ASSINGMENT 2011-2012 Nikesh Hindocha (10044607) Part A. Introduction As part of my assignment‚ I have been asked to discuss the following statement “Mergers and acquisitions can be value destroyers or value creators”. A merger can be defined as when two equal businesses in terms of profit margin and status‚ combine in order to become one legal entity. Initially‚ the fundamental reason for this merge is to produce a company that is worth more than the sum of its parts
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International Journal of Research in Management ISSN 2249-5908 Issue2‚ Vol. 2 (March -2012) Merger and Acquisition in Banking Industry: A Case Study of ICICI Bank Ltd. Dr. K.A. Goyal* and Vijay Joshi** *Former Head of Management Department‚ BIT-WCAS‚ Muscat‚ Oman. Faculty‚ Shri Govind Guru Government College‚ Banswara. Email-kagoyala@gmail.com‚ +91 7597293666 **Doctoral Research Scholar‚ Department of Business Administration‚ UCCMS‚ MLSU‚ Udaipur. Email-vij.joshi18@rediffmail.com‚ +91
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offer consumers a choice in local phone service. By 1999‚ 98% of homes had no choice in local service (Wikipedia‚ 2005). Passage of the Act resulted in several mergers including AT&T’s purchase of TCI Corporation‚ the merger between Bell Atlantic and NYNEX‚ the merger between Qwest and US West‚ the merger between SBC and AT&T‚ and the merger between Sprint and Nextel. The purpose of this document is to discuss regulatory issues facing the telecommunications industry. In this document‚ we will discuss
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HUMAN RESOURCE MANAGEMENT’s PIVOTAL ROLE in MERGERS & ACQUISITIONS Ajit Kumar Mumbai‚ India Abstract Human Resource Management in Mergers & Acquisitions Organizations of all sizes and across all industry sectors are increasingly looking to M&A to support their global growth strategies. The primary objectives for M&A’s are to cut costs‚ broaden market shares or take advantage of each other’s synergies and most typically to accelerate growth. Yet several studies indicate that more than
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Industry Analysis: Cadbury Schweppes (CS) is comprised of a global confectionery and beverage company. For the purpose of this case we will maintain our focus on the confectionery business and the assessment of adding to their sugar confectionery portfolio. CS is number three in the beverage business but see the opportunity to become the largest confectionery in the world. The categories are chocolates‚ sugar and chewing gum. At this time Adams is the number two sized in the gum business. This
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