Shares of each of America Online and Time Warner common stock are traded on the New York Stock Exchange. On January 7, 2000, the last trading day before the public announcement of the merger, America Online common stock closed at $72.88 per share and Time Warner common stock closed at $64.75 per share. Based on the Time Warner common stock exchange ratio, 1.5, the pro forma equivalent per share value of the Time Warner common stock on January 7, 2000 was equal to approximately $109.32 per share. On May 15, 2000, America Online common stock closed at $58.50 per share and Time Warner common stock closed at $86.06 per share. The pro forma equivalent per share value of the Time Warner common stock on May 15, 2000 was approximately $87.75 per share."
Using the above information, explain using calculations the $109.32 "pro forma" equivalent per share value of the Time Warner common stock on January 7, 2000. Explain (by calculations) the $87.75 per share price.