Question
Skywalker Inc. is proposing a rights offering. Presently there are 244,000 shares outstanding at $90 each. There will be 61,000 new shares offered at $57
Skywalker Inc. is proposing a rights offering. Presently there are 244,000 shares outstanding at $90 each. There will be 61,000 new shares offered at $57 each.
a) What is the market value of the company after the offering is complete?
b) How many rights will it take to buy one share? Round the your answer to the nearest whole integer.
c) Given that the value of the company after the offering is complete is $25,437,000, what is the ex-rights price (the price after the offering is complete)? Enter your answer rounded to 2 DECIMAL PLACES.
d) Given that the ex-rights price is $83.40, what is the value of a right? Enter your answer rounded to 2 DECIMAL PLACES.
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Valuation Measuring and managing the values of companies
Authors: Mckinsey, Tim Koller, Marc Goedhart, David Wessel
5th edition
978-0470424650, 9780470889930, 470424656, 470889934, 978-047042470
