(a) Win Corp. is proposing a rights offering. Presently there are 650,000 shares outstanding at RM21 each. There will 40,000 new shares offered at RM15 each. Calculate the following: (i) New market value of the company. (ii) Numbers of rights that associated with one new shares. (iii) The ex-rights price. (iv) The value of a right. (v) Total flotation cost. Given the flotation cost is 7 percent.

(a) Win Corp. is proposing a rights offering. Presently there are 650,000 shares outstanding at RM21 each. There will 40,000 new shares offered at RM15 each. Calculate the following: (i) New market value of the company. (ii) Numbers of rights that associated with one new shares. (iii) The ex-rights price. (iv) The value of a right. (v) Total flotation cost. Given the flotation cost is 7 percent.

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter3: The Financial Environment: Markets, Institutions And Investment Banking

Section: Chapter Questions

Problem 16PROB

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