Given Pansy Petals Berhad has 1 million shares outstanding, each of which has a price of RM20 so market value of Pansy Petals= 1Million shares*RM 20=RM 20Million

Sweet Stems Corporation which has 1 million shares outstanding priced at RM15 per share so market value of Sweet Stems Corporation= 1Million shares*RM 15=RM 15Million

Given there will be no synergies after acquisition so no additional benefit.

1. Post take over value of Pansy Petals Berhad = market value of Pansy Petals Berhad + market value of Sweet Stems Corporation

=RM 20Million +RM 15Million= RM 35 Million

2. No of share to be offered by Pansy Petals Berhad Sweet to Stems Corporation in exchange of their share

considering the exchange is based on market price so exchange ratio= market price per sahre of target/market price per share of acquirer

=15 RM/20 RM=0.75 shares

so for every 1 share of Sweet Stems Corporation,Pansy Petals Berhad will issue 0.75 shares

so for 1 Million shares of Sweet Stems Corporation,Pansy Petals Berhad will issue 0.75 Million shares

3. New price of Pansy Petals Berhad post takeover = Market value post acquisition/total no of shares outstanding after acquisition

Total no of shares outstanding after acquisition = Exisiting shares of Pansy Petals Berhad + New shares issued to Sweet Stems Corporation

=1Million shares+0.75 Million shares=1.75 Million shares

So New price per share of Pansy Petals Berhad = RM35 Miilion/1.75 Million shares = RM20

4.  Calculate earnings per share of Pansy Petals Berhad after the acquisition

= total earnings after acquisition/total no of shares outstanding after acquisition

Total earnings after acquistion = earnings before acquisition+earnings of  Sweet Stems Corporation

=1 Million shares*RM5+1Million shares*RM 5= RM 10 Million

so RM 10 Million/1.75Million shares = RM 5.714 per share.