Firm B's 1 Million Shares of Stock Currently Sell for $12

question 50

Multiple Choice

Firm B's 1 million shares of stock currently sell for $12 each, but firm A is preparing a tender offer of $18 per share. Firm A estimates the gain of the merger to be $5 million. What percentage of the merger gains will be captured by firm B's stockholders?

• A) 33.33%
• B) 50.00%
• C) 66.67%
• D)54.55%

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Definitions:

Hals

A Dutch Golden Age painter known for his lively and loose brushwork in portraits.

French Art Patron

An individual or institution from France that supports the arts by providing financial assistance, commissioning works, or promoting artists.

17th Century

A period in history from 1601 to 1700, marked by significant cultural, political, and scientific developments in Europe and elsewhere.

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Known as the "Sun King," he was a monarch of the House of Bourbon who reigned as King of France from 1643 until his death in 1715.