KT Corporation Has Announced Plans to Acquire MJ Corporation

question 44

Essay

KT corporation has announced plans to acquire MJ corporation.KT is trading for $45 per share and MJ is trading for $25 per share,with a premerger value for MJ of $3 billion dollars.If the projected synergies from the merger are $750 million,what is the maximum exchange ratio that KT could offer in a stock swap and still generate a positive NPV?

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