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Frankie's Baseballs value of operations is equal to $800 million after a recapitalization. (The firm had no debt before the recap.) Frankie raised $200 million
Frankie's Baseballs value of operations is equal to $800 million after a recapitalization. (The firm had no debt before the recap.) Frankie raised $200 million in new debt and used this to buy back stock. Frankie had no short-term investments before or after the recap. After the recap, wd = 25%. The firm had 20 million shares before the recap. What is price of Frankie's stock after the recap?
A $35
B $30
C $40
D $25
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