The birdie golf’s and hybrid golf merger

THE BIRDIE GOLF’s and HYBRID GOLF MERGERBirdie Golf, Inc., has been in merger talks with Hybrid Golf Company for the past six months. After several rounds of negotiations, the offer under discussion is a cash offer of $352 million for Hybrid Golf. Both companies have niche markets in the golf club industry, and the companies believe a merger will result in significant synergies due to economies of scale in manufacturing and marketing, as well as significant savings in general and administrative expenses. Bryce Bichon, the financial officer for Birdie, has been instrumental in the merger negotiations. Bryce has prepared the following pro forma financial statements for Hybrid Golf assuming the merger takes place.The financial statements include all synergistic benefits from the merger:2012… 2013… 2014… 2015… 2016Sales 512,000,000 576,000,000 640,000,000 720,000,000 800,000,000Production costs 359,200,000 403,200,000 448,000,000 505,600,000 564,000,000Depreciation 48,000,000 51,200,000 52,800,000 53,120,000 53,600,000Other expenses 51,200,000 57,600,000 64,000,000 72,320,000 77,600,000EBIT 53,600,000 64,000,000 75,200,000 88,960,000 104,800,000I per share? 4. What is the highest exchange ratio Birdie would be willing to pay and still undertake the merger? 

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