1) Bruce Wayne is going public with his new business. Berkman Investment Bank will be his...

1) Bruce Wayne is going public with his new business. Berkman Investment Bank will be his banker and is doing a best efforts sale with a 3.9% commission fee. The SEC has authorized Wayne 4,840,000 shares for this issue. He plans to keep 1,210,000 shares for himself, hold back an additional 200,000 shares according to the green-shoe provision for Berkman Investment Bank, pay off Venture Capitalists with 500,000 shares, and sell the remaining shares at $16.17 a share. Given the bids at the auction (shown on the table here:

Bidder	Quantity Bid
Gotham Pension Fund	1,990,000
Clark Kent Investors	1,020,000
Central City Insurance	610,000
Arthur Curry	350,000
Barry Allen	340,000
Total	4,310,000

a) How many shares does Gotham Pension get?

b) How many shares does Clark Kent Get?

c)How many shares does Arthur Curry get?

d) How many shares does Barry Allen get?

e) What is the total cash flow to Wayne after the sale?

f) What is the total cash flow to Berkman Investment Bank after the sale?

2) Criss-Cross Manufacturers will issue commercial paper for a short-term cash inflow. Criss-Cross must raise $5,800,000, and the paper will have a maturity of 182 days. If this paper has a maturity value of $50,000 and is selling at an annual interest rate of 8.6%,

what are the proceeds from each paper?

what is the discount rate on the commercial paper?

Solutions

Expert Solution

jeff jeffy answered 8 months ago

Next > < Previous

Related Solutions

Bruce Wayne routinely participates in activities such as skydiving, rock climbing, and bungee jumping. His employer...

Bruce Wayne routinely participates in activities such as skydiving, rock climbing, and bungee jumping. His employer told him to stop the activities or they would cancel his health insurance. Bruce's health insurance was cancelled after an article appeared in the paper highlighting his dangerous life style. Bruce sued. Does he have a case?

Wayne Deng is reviewing the statement of cash flows for his technology business. The Statement has...

Wayne Deng is reviewing the statement of cash flows for his technology business. The Statement has been provided by his accountant. He is dismayed that the statement shows net cash outflows for investing activities. Marks: 10 Explain to Wayne what the cash flow from investing activities section of the cash flow statement shows. Marks: 2 Should Wayne be concerned by reported net cash outflows for investing activities? Discuss and defend your conclusion. Include an example to illustrate your conclusion Marks:...

business law 21. Sunil and his brother Leandro set up an investment account with a bank,...

business law 21. Sunil and his brother Leandro set up an investment account with a bank, as Tenants in Common. Each puts $25,000 into the account, and they buy and sell stock together, splitting all interest and dividend income equally, and sharing any losses equally. After about thirty years of doing this, the account has grown to a total of about $200,000. Sunil got married, and had one child, Arjun. Sunil’s wife unfortunately died in 2015. Leandro has never married,...

John Wayne is 50 years old and plans to retire in 20 years. His new employer...

John Wayne is 50 years old and plans to retire in 20 years. His new employer provides 401K retirement plan and he plans to accumulate $1,000,000 in his retirement account by age of 70. Use Excel to answer the following questions. How much he has to contribute per year at return of 7% per year to reach his retirement goal. Redo part (a) if john decides to increase his contribution 0.50% per year over 20 years. c.Redo part (a) if...

3) If a bank is going to open a new branch in a distant city, with...

3) If a bank is going to open a new branch in a distant city, with what inputs will the human resource department be concerned? What activities will the department need to undertake in the transition to a fully staffed and operating branch? What type of feedback do you think the department should seek after the branch has been operating for six months?

Bruce Reid, Blake Memorial Hospital’s new CEO, rubbed his eyes and looked again at the 1992...

Bruce Reid, Blake Memorial Hospital’s new CEO, rubbed his eyes and looked again at the 1992 budget worksheet. The more he played with the figures, the more pessimistic he became. Blake Memorial’s financial health was not good; it suffered from rising costs, static revenue, and declining quality of care. When the board hired Reid six months ago, the mandate had been clear: improve the quality of care and set the financial house in order. Reid had less than a week...

An investment bank is taking a firm public. The bank finds that recently five firms from...

An investment bank is taking a firm public. The bank finds that recently five firms from the same industry went public at an average offer price per share to EBITDA per share ratio of 7.5. If the private firm’s EBITDA is $1.2 per share for the most recent year, then an offer price estimate would be A.$7.5 B.$8.5 C.$9.0 D.$10

Corporate Finance *Going Private: absence of a public float Two methods of going private: 1- A...

Corporate Finance *Going Private: absence of a public float Two methods of going private: 1- A publicly owned company purchased by a private company or a private equity fund. 2- Repurchasing all publicly traded shares from stockholders. My question is: Leveraged buyout an easy way to go private. Please explain why or how?

Blake and his housemates started an investment club, and it has been going well. So far,...

Blake and his housemates started an investment club, and it has been going well. So far, Brett has presented a pharmaceutical company with the potential of hitting it big with a drug that is about ready to go to market after clinical trials. Peter has presented a new sushi fast-food chain that is going public in order to expand throughout the United States. Leigh is ready to present her recommendation to the group but is hesitant. Leigh’s concern is that...

Yani has $12,000 for investment purposes. His bank has offered the following three choices: Choice 1....

Yani has $12,000 for investment purposes. His bank has offered the following three choices: Choice 1. A special savings certificate that will pay $120 each month for 5 years and a lump sum payment at the end of 5 years of $13,000 Choice 2. Buy a share of a racehorse for $12,000 that will be worth $27,000 in 5 years Choice 3. Put the money in a savings account that will have an interest rate of 12% per year compounded...

Subjects