During the most recent fiscal year, KD Industries had revenues of $400,000,000& earnings of $30,000,000. KD has filed a registration statement with the OSC for its IPO. Before it is offered, KD's investment bankers would like to estimate the value of the firm using comparable companies. The investment bankers have assembled the following information based on data for other companies in the same industry that have recently gone public. In each case the ratios are based on the lPO price. Comparable Company ---------Price/Earnings------------ Price/Revenues

Eenie------12.41-----.6 Meenie--------14.61--------.4

Minie--------16.21----------.2

Moe-----------20.40-----------.8

(1) Based on the average price ratios, what would be a reasonable range for value of KD?

(2) Assuming that KD has 25 million shares outstanding and the lead investment banker's recommendation of using the median be accepted, what will be the lPO price per share? How much capital will KD raise by issuing 10,000,000 new shares (net of 5% underwriting spread)?