In March 2022, Coca-Cola Limited made a rights issue with a subscription price of $4 per share for every four existing shares outstanding. Coca-Cola currently has 8 million shares on issue and is trading at $5.5 per share. What is the total amount of new capital Coca- Cola can raise from the rights offer? b. Coca-Cola is allowing current shareholders the opportunity to buy one new share at a price less than the current market price. What is the value of one right? What is the share price on the ex-right date? а. с.
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- Yonkers Inc. is issuing new common shares in a rights offer to raise $10 million for a new project. The subscription price for each new share is $20. The firm currently has two million common shares outstanding, each priced at $25 in the market. What is the price of each right? Select one: a. $1 b. $2 c. $5 d. $10 e. $15XYZ Ltd has 900,000 shares outstanding at current market price of $ 130 per share. The company needs $ 22,500,000 to finance its proposed expansion. The board of directors has decided to issue rights for raising the required funds. The subscription price has been fixed at $ 75 per share. Required: (a) How many rights are required to purchase one new share? (b) What is the price of one share after the rights issue (Ex-right price)? (c) Compute the theoretical value of each right| 19:32Farah’s Fine Fashions (FFF) is considering raising money through a rights offering. FFF currently has 10 million shares outstanding selling for $22 per share. Current shareholders will receive one right per share. Five rights are required to buy one share for $20. Will the rights be exercised and if so, what is FFF’s new market value if all rights are exercised? Select one: a. The rights will not be exercised. b. $220 million c. $260 million d. $321 million e. None of the above.
- Myers Inc. currently has 5, 750,000 shares outstanding, and they trade at a price of $23.76. They need to raise $35,000,000 in new funding, and will execute a Rights Offering at a subscription price of $18.00 per share. At the current share price, what will be the price of one Right leading up to the subscription? Group of answer choices $3.04 $1.46 $1.74 $22.30 $2.96The New Word Corporation has 1,000,000 shares outstanding at $45/share. If the firm wishes to raise $15.00 million at a subscription price (North American rights offering) of $30/share, calculate the value of a right.Investor Integrity wants to buy share, P100 par value from Honesty Company. According to his research, Honesty Company’s share come with a constant dividend of P5 per share up to 2021. Investor Integrity intends to hold the share for a longer time and no plans in selling it in the future. Honesty Company sells its share for P110 per share. Investor Integrity requires a 20% return on all of his investment. In 2022, Honesty Company shows the following information (see image below).What is the price/earnings ratio of Honesty Company share?
- Brown Mines needs $1.2 billion of new equity.Market price is $25.Brown Mines decides to raise addtional funds by offering the right to buy 4 new shares for 16 at $12 per share.WIth 100% subscription,what is value of each right? A.$10.4 B.8 C.16 D.9.6HungHom Inc. has 250,000 shares outstanding at $60 per share. For expansion of its overseas plant facilities, the company has decided to raise $5,000,000 by a rights offering with a subscription price of $50. 2-1. How many new shares are offered to raise the required funds? Answer: Number of new shares = ____________ 2-2. How many rights are needed to buy a new share via rights offering? Answer: Number of rights needed = _________rights per share 2-3. What will the price per share be if all rights are exercised? Use two decimal points rounded up (e.g., 79.54). Answer: Price per share = $_____________ 2-4. Assuming everything else is constant, what is the value of the right? Use two decimal points rounded up (e.g., 79.54). Answer: Value of the right=_____________$The New Word Corporation has 1,000,000 shares outstanding at $30/share. If the firm wishes to raise $13.5 million at a subscription price (North American rights offering) of $27/share, calculate the value of a right. A. $1/right B. $2/right C. $3/right D. $4/right Ex[lain
- A company expects to earn Rs.4.4 million in 2022, and 50% of this amount orRs.2.2 million has been allocated for distribution to common shareholders. Thereare 1.1 million shares outstanding and the market price is Rs.20 a share. Thecompany believes it can either use Rs.2.2 million to repurchase 100,000 sharesthrough a tender offer at Rs.22 a share or else pay a cash dividend of Rs.2 a share.How does this affects EPS, P/E and expected market price?Rock Industries has hired the investment banking firm to help for going public. Rock and investment bank agree that Rock's current value of equity is $75 million. Rock currently has 5 million shares outstanding and will issue 2 million new shares. Investment bank charges a 7% spread. What is the offer price based on this information? a. $10.93 b. $15.00 c. $14.59 d. $10.71Kiser Mfg. is considering a rights offer. The company has determined that the ex-rights price will be $78. The current price is $100 per share, and there are 25 million shares outstanding. The rights offer would raise a total of $50 million. What is the subscription price? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Subscription price