Consider given problem again. Assume that there are immediate synergistic benefits of $4 million if Apex and Pinnacle merge. Answer parts a, b, and c of problem 8 under these conditions.
Problem
Apex Corporation is considering the purchase of Pinnacle Company in a stock-forstock exchange. Selected data on the two companies are shown in the following table:
Assume that there are no synergistic benefits as the result of the merger. Determine EPS for the combined company if Apex offers a
a. 20 percent premium for Pinnacle
b. 40 percent premium for Pinnacle
c. 50 percent premium for Pinnacle.