Terminus Ltd (TRS Ltd) owns a chain of retail grocery stores located in all Australian states. TRS Ltd had its Initial Public Offer (IPO) of shares on the 1st of March 2021. The company had 50,000,000 shares on issue before the offer. The share offer was underwritten by Bath Investments Pty Ltd, at no cost to the company. The share offer consisted of 5,000,000 new shares (no shares were sold by the existing shareholders in this IPO; also, no existing shareholder participated in the IPO - i.e. existing shareholders did not buy any additional shares through the IPO). The offer size (number of shares sold in the IPO) represented 10 percent of total shares on issue outstanding before the offer. The share offer (subscription) price was $4.00 per share. Subscriptions received by the underwriter at the offer close date were for a total of exactly 5,000,000 shares. Market share values were as follows:

First trading day close price was $5.00.

One year after the IPO, share price was $4.00 (in the corresponding period the market index return was 5.5 percent, while the companys relevant industry index provided 6.6 percent return in this period). Company share systematic risk (beta) has been estimated at 1, while the market (industry) index beta is estimated at 1 (1.1).

Based on the above scenario, insert correct word(s) to complete each statement below:

a) From the perspective of the original owners, based on listing day return, this IPO is

b) Considering the IPO's characteristics and the first trading day's closing share price, what is the wealth effect on the original owners (should they be considered to be better- or worse-off by the end of the first trading day)?

c) One year after listing, was this IPO's post-listing day returns performance typical of the IPO returns that we observe historically?

d) What Is the cost of underwriting this offer typical of IPOs?