queation 46 jun 2009 BBS STORES

[alryami2009]

MARKET VALUE IN OPTION 2 IS 5929 HOW WE CALCULATE THAT AND VALUE OF RETAILER IS 4705 WHO WE DRIVE THIS FUG ER AND as PER BPP TOTAL MARKET IS 5929 WHEREAS AS PER KARLAN KIT IS 5936 PLEASE ADVICE

IS THIS QUESTION IMPORTANT AS ITS THREE IS A LOT OF COMPLEX CALCULATION

[John Moffat]

Please don’t type in capital letters.

Currently there are 4 x 425M = 1700M shares in issue (they are 0.25c shares).
They will buy back 217.75M shares (the workings for this are in the answer).
So they will be left with 1700 – 217.75 = 1482.25M shares.
Assuming that the share price stays at $4, the total market value of the shares is 1482.25 x $4 = $5929.

I don’t know why Kaplan have got 5936 – I don’t have their answer. Maybe it is rounding (and if it is then rounding does not matter in the exam).

I don’t understand what you mean by “who we drive this fug er”

[Author]

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