Global Network has a market value of $898,000.AG Communications has 50,000 shares of stock outstanding at a price per share of $60.AG is acquiring Global in an exchange for 15,000 shares of AG stock.The merger is expected to create $220,000 of synergy.What will be the post-merger value of the firm?
A)$3,218,000
B)$3,782,000
C)$4,118,000
D)$3,220,000
E)$3,898,000

Question

Quizplus · Accepted Answer

V_AB = (50,000 × $60)+ $898,000 + 220,000 = $4,118,000

Global Network Has a Market Value of $898,000