Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › 55-Sigra co.
- This topic has 3 replies, 3 voices, and was last updated 11 months ago by John Moffat.
- AuthorPosts
- November 27, 2021 at 8:37 pm #641820
1stly for cash offer why arent we taking synergy benefits while calculating the % gain, since it has been mentioned 30% synergy gain we attain
2ndly for sh for sh exchange, i didnt understand how the final % gain step has been done ..i.e
[($3.644 × 3 – $4.50 × 2)/2]/$4.50 × 100% = 21.5%
the *3 and *2 nd /2
why?November 28, 2021 at 9:43 am #641853The cash offer is at $5 per share and if the payment is in cash it is irrelevant to shareholders in Dentro what happens to the share price of Sigma after the acquisition.
If there is a share offer, then the new share price of Sigma is relevant.
For every 2 shares currently held in Dentro the shareholders will get 3 shares in Sigma.I someone holds 2 share in Dentro they are currently worth 2 x $4.50 = $9.
They will get instead 3 shares in Sigma and be worth 3 x $3.644 = $10.932So they will make a gain of $1.932 for every 2 shares they hold, which is 1.932/2 = $0.966 gain for every one existing share.
October 25, 2023 at 11:46 pm #693985Thank you Sir.
I have the same doubt and now I understand the logic behind itOctober 26, 2023 at 8:07 am #694007Great 🙂
- AuthorPosts
- You must be logged in to reply to this topic.