Generic Company has a premerger value of $200 million and Company A has a premerger value of $30 million. After merging the new company is worth $250 million. What is the synergy value of the merger?
A) $20 million
B) $30 million
C) $50 million
D) $200 million
E) $250 million

Question

Quizplus · Accepted Answer

The synergy value of the merger is calculated by subtracting the sum of the premerger values of both companies from the post-merger value of the new company. Thus, $250 million - ($200 million + $30 million) = $20 million.

Generic Company Has a Premerger Value of $200 Million and Company