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The shareholders of Jolie Company have voted in favor of a buyout offer from Pitt Corporation....

The shareholders of Jolie Company have voted in favor of a buyout offer from Pitt Corporation. Information about each firm is given here:
Jolie Pitt
  Price–earnings ratio 9.9 29
  Shares outstanding 78,000 290,000
  Earnings $ 260,000 $ 990,000

   

Jolie's shareholders will receive one share of Pitt stock for every three shares they hold in Jolie.
a-1

What will the EPS of Pitt be after the merger? (Do not round intermediate calculations and round your answer to 3 decimal places, e.g., 32.161.)
  EPS $   


a-2

What will the PE ratio be if the NPV of the acquisition is zero? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
  PE   

  

b.

What must Pitt feel is the value of the synergy between these two firms?

  

  Synergy value $   

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jeff jeffy answered 2 years ago
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