A best efforts IPO underwriting comprised 5.8 million shares at an offer price of $28 per...

A best efforts IPO underwriting comprised 5.8 million shares at an offer price of $28 per share. The underwriter's fee was set at 5.85 percent. How many shares were sold if the issuer received $84,324,892?

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Expert Solution

Ans

underwriter's fee = 5.85% or 0.0585

Percentage of net amount received = 1 - 0.0585 = 0.9415

Hence

NO of share sold = 84,324,892 ÷ ( 28 × 0.9415)= 3,198,728.93

Rahul Sunny answered 2 years ago

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