How many new shares must the company sell

Assignment Help Corporate Finance
Reference no: EM131328382

The Bloomington Company needs to raise $20 million of new equity capital. Its common stock is currently selling for $42 per share. The investment bankers require an underwriting spread of 7 percent of the offering price.

The company's legal, accounting, and printing expenses associated with the seasoned offering are estimated to be $450,000. How many new shares must the company sell to net $20 million?

Reference no: EM131328382

Questions Cloud

What is the equity beta of the levered firm : An unlevered firm has an asset market beta of 1.5. The risk-free rate is 3%. The equity premium is 4%. What is the firm’s cost of capital? The firm refinances itself. It repurchases half of its stock with debt that it issues. Assume that this debt is..
Which company do you expect will have the higher beta : Which company do you expect will have the higher beta? Check the reported betas on Thomson ONE to see if they match your expectations.
How does beta of intel today compare to its earlier estimate : How does the beta of Intel today compare to its earlier estimate from May 2008? Was its beta stable (over time)? How does the beta of AMD today compare to its earlier estimate from May 2008? Was its beta stable? AMD is a much smaller firm than Intel...
Construct equity account for guaraldi at end of first year : Construct the equity account for Guaraldi at the end of its first year in business and calculate the firm's market capitalization.
How many new shares must the company sell : The company's legal, accounting, and printing expenses associated with the seasoned offering are estimated to be $450,000. How many new shares must the company sell to net $20 million?
Create an adr issue that meets zscs preferences : Assume that ZSC's stock price declines from SF25.00 to SF22.50 per share. If the exchange rate does not also change, what will happen to ZSC's ADR price?
How can a corporation estimate the amount of financing : How can a corporation estimate the amount of financing that must be raised externally during a given year? Once that amount is known, what other decision must be made?
Write a refelection paper about the case studies : Associate what you have learned about theory in comparison to the case study and reflect on it. A comparison of the case study to your nursing practice, giving one or two examples from your nursing experience in which you might have applied a parti..
Define the term financial intermediary : Define the term "financial intermediary." What role do financial intermediaries play in U.S. corporate finance? How does this compare with the role of non-U.S. financial intermediaries?

Reviews

Write a Review

Corporate Finance Questions & Answers

  You must evaluate a proposed spectrometer for the rampd

you must evaluate a proposed spectrometer for the rampd department. the base price is 200000 and it would cost another

  What is the present value of the cca tax shield

What is the depreciation tax shield in the third year for this project and what is the present value of the CCA tax shield - what is the minimum bid price the firm should set as a sale price for the blocks if the firm were in a bidding situation?

  What accounting problem arises if an internal service fund

What accounting problem arises if an internal service fund is operated at a significant profit?What accounting problem arises if an internal service fund is operated at a significant loss?

  Adjust the tax expense for unrealized profit or losses

Adjust the tax expense for unrealized profit or losses - Prepare the consolidated journals for Alpha Ltd and its controlled entity for 2011

  What is a reasonable median total enterprise value

What is a reasonable median Total Enterprise Value/EBITDA and what is a reasonable median Total Enterprise Value/Revenues?

  Identify one or two variables that might influence behavior

List five behaviors that you could observe in your day-to-day life. For each one, identify one or two variables that might influence the behavior.

  Calculate the dollar amount of acceptable accounts

Springer manufactures wants to borrow $80,000 from a local bank using accounts receivables to secure its loan. The banks procedure is to accept as collateral accounts that are normally paid within thirty days

  Compare in terms of price to book ratios

Show how these two companies compare in terms of Price to Book ratios and Excess Returns Note: When showing the comparison of the two companies, you can use a graph or simple table. Please explain why they are similar or different.

  Explain current ratio, discuss implications

Can someone please provide information on the following: what the company can do to handle short-term debt that is coming due.

  Defining capital structure weights

The current owners have no debt financing but Templeton plans to borrow $300 million and invest only $100 million in equity in the acquisition. What weights should Templeton use in computing the WACC for this acquisition

  What years did goggle generate positive cash flow

What years did Goggle generate positive cash flow from its operations? What rate of return did you earn on your investment in Placo's stock? Describe Goggle's main source of financing in the financial markets over the period.

  An investor be indifferent between these two bonds

1)Corporate Bonds issued by ABC Corporation currently issued 12.1%. Municipal Bonds of equal risk currently yield 7.7%. At what tax rate would an investor be indifferent between these two bonds?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd