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Problem 15 You have been provided the following Financial data of two companies: Particulars Krishna Rama Earnings after taxes Rs

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Problem 15 You have been provided the following Financial data of two companies: Particulars Krishna Rama
Earnings after taxes Rs. 7,00,000 Rs. 10,00,000 Equity shares (outstanding) 2,00,000 4,00,000 EPS 3.5 2.5
P/E ratio 10 times 14 times Market price per share Rs. 35 Rs. 35 Company Rama Ltd. is acquirin... Show more

WANT SOLUTION FOR BELOW QUESTION:PQR Ltd. is considering to acquire XYZ Ltd. The financial data of the companies are given below in the following table Details PQR Ltd. XYZ Ltd. Profit After Tax - Rs XYZ-40,000 PQR-8,000 Number of Shares - Rs XYZ-10,000 PQR- 4,000 Market Value per share - Rs XYZ- 60 PQR-15 P/E Ratio (Times) XYZ-15 PQR- 7.5 "PQR Ltd. is considering to acquire XYZ ltd. through exchange of shares in proportion of the market value per share. Work out the following: (i) Exchange of shares based on Market value per share (ii) Number of shares to be issed by PQR Ltd. to XYZ Ltd. (iii) What is the EPS after Merger? (iv) Comparative earnings of shareholders of XYZ Ltd. before and after Merger (v) Comparative earnings of shareholders of PQR Ltd. before and after Merger (vi) Provide your observations and would there be any impact on the earnings of the shareholders after merger?"