Stock versus Cash Offers. Suppose that instead of making a cash offer as in Problem 9, Velcro Saddles considers offering Skiers' shareholders a 50% holding in Velero Saddles. (LO₂I-2)
a) What is the v:
a) Equivalent percentage holding in Skiers' shares?
b) Current market value of Velero Saddles?
c) Total value of the offer if Skiers' shares are valued at $500 million?
d) Potential benefits and risks of this type of offer?
