Appendix i
Based on PBIT, calculation of the growth rate 2
Calculation of free cash flows 2
Calculation of company value, equity value and value of each share 3

Max marks 7

Appendix ii
Cash offer
Additional value created for Mije Co shareholders 3
Value created per share for Nente Co shareholders 1
Share-for-share offer
Expected share price for the combined company 2
Value created for Nente Co share 1
Value created for Mije Co share 1

Max marks 8

Appendix iii
PV of underlying asset 1
Value of exercise price 1
N(d1) 2
N(d2) 2
Value of call 1
Value added to Nente Co share 1

Max marks 8

Discussion
Nente Co shareholders 2–3
Mije Co shareholders 1–2
Assumptions made 2–3
Use of value of follow-on product 2–3

Max marks 8

Professional Marks
Report format 1
Structure and presentation of the report 3

Max marks 4