AFM*** December 2021 ACCA AFM exam – Instant Poll and comments ***

I also said 2225 Cash offer i got about $1 (or 6%) premium per share for target company I ran out of time to calculate the share exchange and wanted to come back to it but ran out of time. I got something ridiculously wrong like share offer was a 50% decrease or something like that so I just gave advice based on that. Hopefully my correct interpretation of the (wrong) figures still gets some marks I was strict with myself giving 90 mins for first q and 45 for each of the other 2qs. I didn't finish any questions! Really needed more time!

I also used 12% cost of capital in the NPV part of the APV question.

Glad you got similar to me, just the APV question I'm unsure on now. Did you get positive or negative NPV?

I thought it was only calculate the game to Frodir Co shareholders only. Not both sets of shareholders?

I got negative NPV ($12m or $13m i think) which made sense to me because I figured that question would PROBABLY give a negative Npv and positive APV to demonstrate the benefit of treating the debt benefits separately I just never got a chance to finish the APV part to confirm that though When I realised I wouldn't finish the calcs I just quickly wrote down the theory that there would be tax benefits gained from tax shield/debt issue costs but lost from the subsidised loans resulting in reduced interest payments

From what I can remember, the 19 mark calculation part of the question just asked about the gain to Frodir Co shareholders so you're right about that. I think it only took a few seconds to calculate the gain to the predator company after that so I did that to include it in the discussion later on in the part where it asked you to talk about the effects of the cash and share for share offer on the predator company which was worth 7 marks or something like that.

For the 1pm crew... Question 1...I thought it was only calculate the gain to Frodir Co shareholders only. Not both sets of shareholders?

To the value of the combined company for Penicef(1pm exam), I added the profits from the sale of the infrustructure services division to the combined value of the company but, only after I finished discounting cashflows etc...Dont know if anyone else did this or if it was the right thing to so?

I was thinking about doing this but it was too late for me by the time I thought of it. I don't remember if it said anything in exhibit 1 about the sale of that division being something they were going to do related to the acquisition or if it was a totally standalone decision. If it had anything to do with the acquisition I think adding it on was the right thing to do. It'd make sense if that's the case because otherwise the 2 mark part was a really weird inclusion in the question. If it was happening immediately you wouldn't need to discount it either.

I'm sure it said the stated figures were being given after the sale of Penicef. Did it not?

I got the same effective rates - now I am worrying whether I read the question wrong and it said use collars rather than options? Can you remember that it definitely said use option not collar?

I had a completely different question Q1 was an acquisition and question 2 was NPV IRR AND MIRR and VAR question 3 was interest rate hedging which I ran out of time on.

anishalalani wrote:I got the same effective rates – now I am worrying whether I read the question wrong and it said use collars rather than options? Can you remember that it definitely said use option not collar?

There were 2 sets of Q, one is option and the other collar.

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Does anyone remember that profit/loss question figures...what was the consideration and the amount of assets and liabilities

This was a carbon copy of the December 2018 exam. My last ACCA paper and I couldn't have asked for an easier time :)))) I am done! Q1 (a) Benefits of diversification (5) (b) Report (i) Simple disposal calculation (2) (ii) % gain to target company shareholders from two offers - cash & share exchange, FCF & DVM (19) (iii) Problems with new combined company achieving synergy targets (8) (iv) Impact of acquisition on holding company (7) (c) Ethical issues (5) Q2 (a) Advantages of centralised treasury department (7) (b) FRA, IR futures, options, comments (15) (c) Smoothing (3) Q3 (a) APV (15) (b) Advantages of APV (4) (c) Importance of credit rating to shareholders (6)

These were the exact same questions i got also. I had my exam at 2:15 am AST

I am AST also but I did a 9am exam

Had the same questions too

Hi, my self Mayank from India can you please elaborate the question no.I am not wrong in question no.1 the co. Name was ultorne co? Due technical issues my exam got revoked and my exam is going to conduct on 15 can you please help me. If possible can we connect through a call if you don't mind. Thank you.

Mine too is on the 15 but I do not think we can connect. I'm writing FMA. Sorry ?.

It was a fair paper. I panicked and made errors i feel if i had more time it was a pass. Hopefully we can pass