Bavarian-Bavarian Merger Bavarian Brew Is Planning on Acquiring Bavarian Sausage in a in a Pure
Bavarian-Bavarian Merger
Bavarian Brew is planning on acquiring Bavarian Sausage in a pure exchange merger. Bavarian Brew's stock is currently trading at $45 and they set the exchange ratio at 1.80. Bavarian Sausage has 75 million shares outstanding which are currently trading at $23 a share.
Twelve months after the merger Bavarian Brew's stock price drops to $37.
-What is the transaction value of the merger for Bavarian Brew?
A) $3.375 billion
B) $6.075 billion
C) $135 million
D) $1.350 billion
Correct Answer:
Verified
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