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How much cash will zang raise net of the spread

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Reference no: EM132688133

Pricing Stock Issues in an IPO

Zang Industries has hired the investment banking firm of Eric, Schwartz, & Mann (ESM) to help it go public. Zang and ESM agree that Zang's current value of equity is $56 million. Zang currently has 3 million shares outstanding and will issue 1.9 million new shares. ESM charges a 6% spread.

Question 1: What is the correctly valued offer price? Do not round intermediate calculations. Round answer to the nearest cent.

Question 2: How much cash will Zang raise net of the spread (use the rounded offer price)?

Reference no: EM132688133

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