Flotation cost as percentage of funds raised

Assignment Help Financial Management

Reference no: EM131349131

The Collins Co. has just gone public. Under a firm commitment agreement, the company received $33.20 for each of the 4.22 million shares sold. The initial offering price was $35.60 per share, and the stock rose to $43.40 per share in the first few minutes of trading. The company paid $917,000 in legal and other direct costs and $274,000 in indirect costs.

What was the flotation cost as a percentage of funds raised? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Flotation cost percentage:_________%

Reference no: EM131349131

Questions Cloud

Low-regular-and-extra dividend policy : Bennett Farm Equipment Sales, Inc., is in a highly cyclic business. Although the firm as a target payout ratio of 25%, its board realizes that strict adherence to that ration would result in a fluctuating dividend and create uncertainty for the firm'..

What is the value of shares : ABC is a profitable company that is expected to pay a €4.25 dividend next year. The best estimate is that dividends will decline forever at a rate of 10 percent. The required rate of return on ABC stock is 12 percent. ?What is the value of ABC shares..

Share is overvalued and undervalued or properly valued : X shares are expected to pay a dividend of €1.2 at the end of each of the next two years, respectively. The analyst estimates: the required rate of return to be 7%; the expected price at the end of this 2-year holding period to be €28.00. The current..

How sensitive is model value to changes in estimates of r-g : The Gordon growth model value for X company was estimated as €22.18 based on: What if the estimates of r and g can each vary by 25 basis points? How sensitive is the model value to changes in the estimates of r and g ??

Flotation cost as percentage of funds raised : The Collins Co. has just gone public. Under a firm commitment agreement, the company received $33.20 for each of the 4.22 million shares sold. What was the flotation cost as a percentage of funds raised?

Determine optimal capital structure : How would a financial manager determine optimal capital structure? How would this fit in with the company's capital expenditures, growth plans and operating results?

Number of shares offered-how many shares need to be sold : The Zuri Co. needs to raise $65.3 million to finance its expansion into new markets. The company will sell new shares of equity via a general cash offering to raise the needed funds. How many shares need to be sold?

Find cost of dept and equity : The company has curently 20000 shares outstanding. The book value per share in 15€. The stock is currently trading at P/B ratio of 2,0, P/E=12 and EV/EBITDA=7,5. It is also known that the risk free rate is 4%,the beta of the stock is 2,0 and the mark..

Label line unhedged profits-exposure to exchance rate risk : You are a sales representative of an estonian trading company that exports mushrooms to United Kingdom. Under the terms of the contract, in one year you will deliver 80 tons (=80000kg) of mushrooms for 2,8 pounds a kilogram. Plot your profits in euro..

User Account

All Pages