Bumpstead Inc $\begin{array}{lr}1&2&3\\\$455&\$275&\$635\end{array}$ In Addition, Bumpstead Thinks There Will Be $25,000 Per Year

Multiple Choice

Bumpstead Inc. is interested in acquiring Blondies Corp. which it has estimated will generate the following cash flows over the next three years ($000) $\begin{array}{lr}1&2&3\\\$455&\$275&\$635\end{array}$
In addition, Bumpstead thinks there will be $25,000 per year in synergies available at no extra cost. Blondies has 50,000 shares outstanding, and its cost of equity is approximately 14%. If Bumpstead is very conservative, and will not look beyond a three year time horizon to justify an acquisition, how much should it pay per share for Blondies stock?

A) $21.95
B) $20.79
C) $23.84
D) None of the above