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

question 77

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 NPV 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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