A firm announces intent undertake levered recapitalization, Corporate Finance

A firm announces its intent to undertake a levered recapitalization, issuing debt to repurchase a fraction of the outstanding common stock.

Upon the announcement, its stock price declines. Describe (list) 2 reasons why you might have expected that the price would instead have risen and 2 reasonable potential explanations for the decline.  

Each explanation should be very brief, concise and to the point with complete sentences.

Posted Date: 4/5/2013 5:29:49 AM | Location : United States







Related Discussions:- A firm announces intent undertake levered recapitalization, Assignment Help, Ask Question on A firm announces intent undertake levered recapitalization, Get Answer, Expert's Help, A firm announces intent undertake levered recapitalization Discussions

Write discussion on A firm announces intent undertake levered recapitalization
Your posts are moderated
Related Questions
Question : (a) "Risk of diversified portfolio is much lower than the risk of less-diversified portfolio" - What is the relevance of this statement to corporate finance manager

You are required to provide a report of approx 500 words or less (excluding attachments and references), accompanied by relevant calculations, in MS Word, MS Excel and/or PDF forma

Calculate the EAR of the following APR: a. APR at 10.8% compounded monthly. (2 marks) b. APR at 8.4% compounded quarterly. (2 marks) c. APR at 9.0% compounded semi-annually. (2 mar

global scenario of venture capita

Question: 1929/ 2009: a remake of the worst financial crisis affecting the whole world? Central Banks and Governments are implementing all sorts of rescue plans incorporatin


Method is the ?rst of two methods proposed by Mantrala and Rao (2001) and has been reviewed in Section 2.We use a simpli?ed version, with ?xed prices and for a single period. Furth

A firm issues bonds with a coupon rate of 10%, paid annually, having a par value of 1000, YTM of 8% and maturity of 10 years. What is the IRR of buying the bond today and selling

What is the industry average price-earnings ratio? What is the price-earnings ratio for Ragan, Inc.? Is this the relationship you would expect between the two ratios?

Question: (a) Describe the essential characteristics of money. (b) Keynes identified three motives for holding balances of money. (i) What are these three motives?