Essay
Simon Manufacturing Co.is planning to acquire Garfunkel Engineering in a cash plus stock buyout.Garfunkel has 2,000,000 shares of common stock currently outstanding,and the market price is currently at $25 per share.The buyout would offer to purchase Garfunkel Engineering common stock for $19.50 per share,plus a newly issued share of Simon Manufacturing convertible preferred stock,valued at $13.75 per share.
Simon Manufacturing's investment dealer has suggested,as an alternative,a single-stage buyout at $32.50 per share for all of Garfunkel's common stock.
A)What is the total cost of the cash plus stock buyout?
B)What is the total cost of the cash only proposal?
C)If it wants to minimize the total cost of the acquisition,what should Simon Manufacturing do?
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A)Total cost of cash plus stock buyout 
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