Bavarian Brew is planning on acquiring Bavarian Sausage in a pure exchange merger. Bavarian Brew's stock is currently trading at $35 and they set the exchange ratio at 0.80. Bavarian Sausage has 75 million shares outstanding which are currently trading at $18 a share.
-Refer to Bavarian Merger.If you owned 250 shares of Bavarian Sausage what would be the value of your stock holdings after the merger?
A) $3,600
B) $4,500
C) $7,000
D) $8,750
Correct Answer:
Verified
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