What is the highest price per share


Question:

Acquiring Corp. is considering a takeover of takeover Target inc. Acquiring has 10 million shares outstanding, which sell for $40 each. Takeover Target has 5 million shares outstanding, which sell for $20 each. If the merger gains are estimated at $25 million, what is the highest price per share that Acquiring should be willing to pay to Takeover Target shareholders?

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Finance Basics: What is the highest price per share
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