BitBox has raised $12 million in a Series A round with $37 million post-money value and a 1.5x liquidation preference, and $25 million in a Series B round with a $75 million post-money value and a 3x liquidation preference plus seniority over Series A. What will Series A, Series B, and common shareholders receive if BitBox is sold for a. $87 million? b. $102 million? c. $200 million? d. $300 million?
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- The Taussig Company, whose stock price is currently $20.50, needs to raise$15 million by issuing common stock. Underwriters have informed Taussig’s managementthat it must price the new issue to the public at $20 per share to ensurethat all shares will be sold. The underwriters’ compensation will be 7 percent of theissue price, so Taussig will net $18.60 per share. The company will also incurexpenses in the amount of $252,000. How many shares must Taussig sell to net$15 million after underwriting and flotation expenses?Jasmine Flowers must raise $227 million for its future expansion. To do so, Jasmine expects to issue new common stock. Investment bankers have informed the company the flotation costs will be 5.5 percent of the total amount issued plus $556,000 in additional costs associated with the issue. Jasmine can issue its stock for $40 per share. Determine how many shares Jasmine must sell to net $227 million after flotation costs. Round your answer to the nearest whole number. shares?The Presley Corporation is about to go public. It currently has aftertax earnings of $7,700,000, and 2,200,000 shares are owned by the present stockholders (the Presley family). The new public issue will represent 500,000 new shares. The new shares will be priced to the public at $25 per share, with a 5 percent spread on the offering price. There will also be $260,000 in out-of-pocket costs to the corporation. a. Compute the net proceeds to the Presley Corporation. (Do not round intermediate calculations and round your answer to the nearest whole dollar.) b. Compute the earnings per share immediately before the stock issue. (Do not round intermediate calculations and round your answer to 2 decimal places.) c. Compute the earnings per share immediately after the stock issue. (Do not round intermediate calculations and round your answer to 2 decimal places.) d. Determine what rate of return must be earned on the net proceeds to the corporation so there will not be a…
- Raven Co. has just gone public. Under a firm commitment agreement, Raven received $21.39 for each of the 20 million shares sold. The initial offering price was $23 per share, and the stock rose to $28.41 per share in the first few minutes of trading. Raven paid $950,000 in direct legal and other costs and $320,000 in indirect costs. What was the flotation cost as a percentage of funds raisedUnder a firm commitment agreement, Zeke, Company, went public and received $30.00 for each of the 6.8 million shares sold. The initial offer price was $32 and the stock rose to $34.25. The company paid $560, 000 in direct flotation costs and $215,000 in indirect costs. What was the flotation cost as a percentage of funds raised? Multiple Choice 24.34% 14.60% 6.97% 19.89% 23.07%Caleb Clark Ventures invests $2 million in convertible preferred stock in a company with an $8 million pre-money valuation. The term sheet shows the investment is non-participating with 1x liquidation preference. A) Assume the preferred stock is participating. At an exit value of $15,000,000, what is the payoff to the common stockholders (i.e. Founders & Management)? B) If the VC owned non-participating convertible preferred stock with a 2x liquidation preference at what exit value is the VC indifferent between either converting or not converting?
- JJJCorporation is to be sold off by its shareholders. It currently has market values of debt and of equity at $20,000,000 and $25,000,000 respectively. The effective cost of debt is 12% while the cost of equity is 18%. Several analysts determined three potential acquirers who may be able to synergize with JJJ. The following returns from JJJ depending on the acquirer are as follows:" Acquirer Expected Firm Return G 20% H 24% I 18% Based on the above and assuming that liabilities will be retained by the entity, what is the highest selling price that the shareholders can get from the sale of JJJ?Firm B is willing to be acquired by firm A at a price of $16 a share in either cash or stock. The incremental value of the proposed acquisition is estimated at $180,000. Number of shares Firm A: 50000 Firm B: 80000 Price per share Firm A: $18.00 Firm B: $14.00 Debt A: $0 B: $0 What is the value of firm B to firm A?Allan Corporation would like to purchase 60% of Mark Corporation in an acquisition. If Allan pushes through with this, the total equity value of Mark will be as follows: There are 100,000 shares outstanding while the current market value of the 60% of the shares outstanding is P1,800,000. *What is the maximum premium raid price that Allan can set?