In order to execute several growth initiatives, Golden Dragon Hotels need to issue new shares to equity investors in order to raise $15 million. The Company considers an Initial Public Offering on the Singapore Stock Exchange. It has appointed Singapore Investment Bank (SIB) to lead and underwrite the IPO. SIB will charge an underwriting fee of 4% of the gross IPO proceeds for its services. Pre-IPO, Golden Dragon Hotels' share capital comprises of 8 million shares outstanding. Question 10 Identify and explain the key objectives of all stakeholders involved in the IPO, i.e. the company, its current shareholders and new investors who will subscribe to the IPO. (max. 250 words) SIB, the underwriting bank which leads the IPO for Golden Dragon Hotels, has put together the order book (based on investor's expressions of interest) as shown in Table H of the Excel file. Question 11 Based on this, determine (i) the gross proceeds which need to be raised, (ii) the IPO price and (ii) the number of new shares to be issued? Question 12 Calculate the ownership dilution for the pre-IPO shareholders of Golden Dragon Hotels. Question 13 Calculate the market value of equity of Golden Dragon Hotels at the time of the IPO. You can use the IPO price as a proxy for the new stock price. Table 1 IPO order book Price Shares 7.00 1,500,000 6.75 275,000 6.50 325,000 6.25 150,000 225,000 300,000 5.50 325,000 5.25 400,000 5.00 325,000 Question 11 - Based on this, determine (i) the gross proceeds which need to be raised, (ii) the IPO price and (ii) the number of new shares to be issued? Gross proceeds required (incl. underwriting fees) million $ if needed, please use this box for your calculations IPO Price Shares issued $ per share Number of shares Question 12 - Calculate the ownership dilution for the pre-IPO shareholders of Golden Dragon Hotels. f needed, please use this box for calculations In order to execute several growth initiatives, Golden Dragon Hotels need to issue new shares to equity investors in order to raise $15 million. The Company considers an Initial Public Offering on the Singapore Stock Exchange. It has appointed Singapore Investment Bank (SIB) to lead and underwrite the IPO. SIB will charge an underwriting fee of 4% of the gross IPO proceeds for its services. Pre-IPO, Golden Dragon Hotels' share capital comprises of 8 million shares outstanding. Question 10 Identify and explain the key objectives of all stakeholders involved in the IPO, i.e. the company, its current shareholders and new investors who will subscribe to the IPO. (max. 250 words) SIB, the underwriting bank which leads the IPO for Golden Dragon Hotels, has put together the order book (based on investor's expressions of interest) as shown in Table H of the Excel file. Question 11 Based on this, determine (i) the gross proceeds which need to be raised, (ii) the IPO price and (ii) the number of new shares to be issued? Question 12 Calculate the ownership dilution for the pre-IPO shareholders of Golden Dragon Hotels. Question 13 Calculate the market value of equity of Golden Dragon Hotels at the time of the IPO. You can use the IPO price as a proxy for the new stock price. Table 1 IPO order book Price Shares 7.00 1,500,000 6.75 275,000 6.50 325,000 6.25 150,000 225,000 300,000 5.50 325,000 5.25 400,000 5.00 325,000 Question 11 - Based on this, determine (i) the gross proceeds which need to be raised, (ii) the IPO price and (ii) the number of new shares to be issued? Gross proceeds required (incl. underwriting fees) million $ if needed, please use this box for your calculations IPO Price Shares issued $ per share Number of shares Question 12 - Calculate the ownership dilution for the pre-IPO shareholders of Golden Dragon Hotels. f needed, please use this box for calculations
