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Bryan Ltd want to raise 10 million in a rights issue. They currently have 210 million shares outstanding, originally issued at 1 each and now

Bryan Ltd want to raise £10 million in a rights issue. They currently have 210 million shares outstanding, originally issued at £1 each and now trading for £5.00. They want to have a one for three rights issue at £4 each.

a) How many total shares are outstanding after the issue?

b) What is the discount received on the rights issue in terms of pounds and as a percentage?

c) What is the Theoretical Ex-rights Price (TERP)?

d) John has 3,000 shares before the issue and will partake in the rights issue. Calculate the number of shares John will have after the issue.

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