In March 2022, Coca-Cola Limited made a rights issue with a subscription price of $4 per share for every four existing shares outstanding. Coca-Cola currently has 8 million shares on issue and is trading at $5.5 per share. What is the total amount of new capital Coca- Cola can raise from the rights offer? b. Coca-Cola is allowing current shareholders the opportunity to buy one new share at a price less than the current market price. What is the value of one right? What is the share price on the ex-right date? а. с.
In March 2022, Coca-Cola Limited made a rights issue with a subscription price of $4 per share for every four existing shares outstanding. Coca-Cola currently has 8 million shares on issue and is trading at $5.5 per share. What is the total amount of new capital Coca- Cola can raise from the rights offer? b. Coca-Cola is allowing current shareholders the opportunity to buy one new share at a price less than the current market price. What is the value of one right? What is the share price on the ex-right date? а. с.
Chapter20: Financing With Derivatives
Section: Chapter Questions
Problem 12P
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