Strategic Acquisitions Involving Common Stock Example - Company B has agreed on an offer of $35 in common stock of company A. Surviving Company A Total earnings $25,000,000 Shares outstanding 6,093750 Earnings per share $410 Exchange ratio=$35/$64=. 546875 New shares from exchange =. 546875X 2,000,000 =1.093750 23-923-9 Strategic Acquisitions Involving Common Stock Example -- Company B has agreed on an offer of $35 in common stock of Company A. Total earnings $25,000,000 Shares outstanding* 6,093,750 Earnings per share $4.10 Surviving Company A Exchange ratio = $35 / $64 = .546875 * New shares from exchange = .546875 x 2,000,000 = 1,093,750