An executive for a NYSE listed firms with dispersed shareholders, none of whom has more...

50.1K

Verified Solution

Question

Accounting

An executive for a NYSE listed firms with dispersed shareholders, none of whom has more
control influence than others, is considering the acquisition of three possible firms, which are
identical to the buyer, except for the following:
Firm A: publich beld company with a majority sbarebolder.
Firm B: privateby beld company with dispersed shareholders.
Fim C: buy own company througb a leveraged byout.
In class, we discussed the scenarios for valuing control and illiquidity for these three potential
companies that the executive is consider to acquire. A summary chart of the valuation from
class is presented below:
Now, assume that executive re-assess the discount for illiquidity to be 3%, while the control
premium to be 20%, and that all three firms require a control block of only 51%. Can you
please value the control block, and the minority block prices, for each of the three firms?
image

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students