Question
In: Finance
The Clifford Corporation has announced a rights offer to raise $21 million for a new journal,...
|
The Clifford Corporation has announced a rights offer to raise $21 million for a new journal, the Journal of Financial Excess. This journal will review potential articles after the author pays a nonrefundable reviewing fee of $5,000 per page. The stock currently sells for $69 per share, and there are 1.4 million shares outstanding. |
| a. |
What is the maximum possible subscription price? What is the minimum? (Leave no cells blank - be certain to enter "0" wherever required.) |
| b. | If the subscription price is set at $60 per share, how many shares must be sold? How many rights will it take to buy one share? (Do not round intermediate calculations. Round your rights needed answer to 2 decimal places, e.g., 32.16.) |
| c. | What is the ex-rights price? What is the value of a right? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) |
| d. | A shareholder with 2,000 shares before the offering has no desire (or money) to buy additional shares offered as rights. What is his portfolio value before and after the rights offer? (Do not round intermediate calculations and round your answers to nearest whole number, e.g., 32.) |
Solutions
jeff jeffy answered 1 year agoRelated Solutions
The Clifford Corporation has announced a rights offer to raise $20 million for a new journal,...
The Clifford Corporation has announced a rights offer to raise
$20 million for a new journal, the Journal of Financial
Excess. This journal will review potential articles after the
author pays a nonrefundable reviewing fee of $4,000 per page. The
stock currently sells for $40 per share, and there are 1.5 million
shares outstanding.
a.
What is the maximum possible subscription price? What is the
minimum? (Leave no cells blank - be certain to enter "0"
wherever required.)
b.
If...
The Clifford Corporation has announced a rights offer to raise $36 million for a new journal,...
The Clifford Corporation has announced a rights offer to raise
$36 million for a new journal, the Journal of Financial
Excess. This journal will review potential articles after the
author pays a nonrefundable reviewing fee of $5,000 per page. The
stock currently sells for $36 per share, and there are 1.8 million
shares outstanding.
ch15.2
a.
What is the maximum possible subscription price? What is the
minimum? (Leave no cells blank - be certain to enter "0"
wherever required.)
b....
The Clifford Corporation has announced a rights offer to raise $15 million for a new journal,...
The Clifford Corporation has announced a rights offer to raise
$15 million for a new journal, the Journal of Financial
Excess. This journal will review potential articles after the
author pays a nonrefundable reviewing fee of $3,000 per page. The
stock currently sells for $30 per share, and there are 1.8 million
shares outstanding.
a.
What is the maximum possible subscription price? What is the
minimum? (Leave no cells blank - be certain to enter "0"
wherever required.)
b.
If...
The Clifford Corporation has announced a rights offer to raise $15 million for a new journal,...
The Clifford Corporation has announced a rights offer to raise
$15 million for a new journal, the Journal of Financial Excess.
This journal will review potential articles after the author pays a
nonrefundable reviewing fee of $4,000 per page. The stock currently
sells for $32 per share, and there are 2.7 million shares
outstanding.
a. What is the maximum possible subscription price? What is the
minimum? (Leave no cells blank - be certain to enter "0" wherever
required.)
b. If...
Mitsi Inventory Systems, Inc., has announced a rights offer. The company has announced that it will...
Mitsi Inventory Systems, Inc., has announced a rights offer. The
company has announced that it will take three rights to buy a new
share in the offering at a subscription price of $61. At the close
of business the day before the ex-rights day, the company’s stock
sells for $85 per share. The next morning, you notice that the
stock sells for $70 per share and the rights sell for $2 each. What
price should the stock sell for ex-rights?...
Knight Inventory Systems, Inc., has announced a rights offer. The company has announced that it will...
Knight Inventory Systems, Inc., has announced a rights offer.
The company has announced that it will take three rights to buy a
new share in the offering at a subscription price of $61. At the
close of business the day before the ex-rights day, the company’s
stock sells for $85 per share. The next morning, you notice that
the stock sells for $70 per share and the rights sell for $2
each.
What is the
value of the stock ex-rights?...
Mitsi Inventory Systems, Inc., has announced a rights offer. The company has announced that it will...
Mitsi Inventory Systems, Inc., has announced a rights offer. The
company has announced that it will take two rights to buy a new
share in the offering at a subscription price of $60. At the close
of business the day before the ex-rights day, the company’s stock
sells for $90 per share. The next morning, you notice that the
stock sells for $70 per share and the rights sell for $3 each.
What price should the stock sell for ex-rights?...
Rights Issue Micro-Electronics Corporation (MEC) has just announced that it will issue 10 million shares of...
Rights Issue Micro-Electronics Corporation (MEC) has just
announced that it will issue 10 million shares of common stock
through a rights issue at a subscription price of $25. Before the
announcement, MEC shares were trading at $31, and there were 100
million shares outstanding.
a. How many rights will MEC grant to its existing
shareholders?
b. How many rights will an investor need to buy one new
share?
c. What will happen to MEC's share price when the rights issue...
Rights issue. micro-Electronics Corporation (mEC) has just announced that it will issue 10 million shares of...
Rights issue. micro-Electronics Corporation (mEC) has just
announced that it will issue 10 million shares of common stock
through a rights issue at a subscription price of $20. Before the
announcement, mEC shares were trading at $26, and there were 50
million shares outstanding.
a. How many rights will mEC grant to its existing
shareholders?
b. How many rights will an investor need to buy one new
share?
c. What will happen to mEC’s share price when the rights issue...
nbc want to raise $5 million new equity via a rights issue with a subscription price...
nbc want to raise $5 million new equity via a rights issue with
a subscription price of $40/share. Current shares sell (rights on)
for $60 each. Calculate the minimum current value of a right and
the ex-rights share price assuming there are 2 million shares
outstanding before the rights issue. Check your ex rights share
price using another formula.
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