What will be the new purchase price for the existing

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Reference no: EM131965489

Katie Homes and Garden Co. has 15, 200,000 shares outstanding. The stock is currently selling at $90 per share.

If an unfriendly outside group acquired 30 percent of the shares, existing stockholders will be able to buy new shares at 35 percent below the currently existing stock price.

a. How many shares must the unfriendly outside group acquire for the poison pill to go into effect?

b. What will be the new purchase price for the existing stockholders?

Reference no: EM131965489

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