A private placement: The interest rate on the private placement would be 9%, but the total issuing

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A private placement: The interest rate on the private placement would be 9%, but the total issuing expenses would be only $30,000.

a. What is the difference in the proceeds to the company net of expenses?

b. Other things being equal, which is the better deal?

c. What other factors beyond the interest rate and issue costs would you wish to consider before deciding between the two offers?

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Principles Of Corporate Finance

ISBN: 9781264080946

14th Edition

Authors: Richard Brealey, Stewart Myers, Franklin Allen, Alex Edmans

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