Strategic Acquisitions Involving Common Stock Surviving firm EPS will decrease any time the P/E ratio Raid?for a firm is greater than the pre-merger P/E ratio of the firm doing the acquiring. [Note: P/e ratio Raid? for Company B is $45/$2.50 18 versus pre merger P/E ratio of 16 for Company A ] 23-1423-14 Strategic Acquisitions Involving Common Stock Surviving firm EPS will decrease any time the P/E ratio 損aid?for a firm is greater than the pre-merger P/E ratio of the firm doing the acquiring. [Note: P/E ratio 損aid?for Company B is $45/$2.50 = 18 versus pre￾merger P/E ratio of 16 for Company A.]