hard · Principles of Finance cost-of-capital-structure
A company is being acquired for $1,800 million, financed with 50% cash and 50% stock.
The acquirer has 100 million shares outstanding trading at$100each. The target has20million shares trading at75 (acquisition price is $90). If the acquirer's EPS is$5.00and the target'sEPSis5.00, and the after-tax cost of debt for the cash portion is 3.75%, what is the pro forma EPS?
- $5.08
- $5.00
- $5.45
- $5.19
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