Solution-Calculate the post-merger earnings per share

Calculate the post-merger earnings per share

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Reference no: EM133045472

Question - Smidex Company is contemplating the purchase of Malta Company. The exchange is to be based on the market value of both companies. The following are the balance sheets of both companies before the merger takes place.

	Smidex (RM)	Malta (RM)
Assets Current assets	200,000	20,000
Fixed assets	800,000	130,000
	1,000,000	150,000
Liabilities and Equities Current liabilities	70,000	5,000
Long term debt	100,000	25,000
Common stock	600,000	80,000
Capital surplus	100,000	30,000
Retained earnings	130,000	10,000
	1,000,000	150,000
Par value	3	2
Earnings per share	6	2
Market value per share	20	10

Required - You are required to do the following: Calculate the post-merger earnings per share for the acquiring company?

Reference no: EM133045472

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Calculate the post-merger earnings per share

Reference no: EM133045472

Reference no: EM133045472

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