Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

The following information applies to the question within this section. Builders Capital Mortgage Corp. Announces Rights Offering Calgary, Alberta--(Newsfile Corp. - October 21, 2022) -

image text in transcribed

The following information applies to the question within this section. Builders Capital Mortgage Corp. Announces Rights Offering Calgary, Alberta--(Newsfile Corp. - October 21, 2022) - Builders Capital Mortgage Corp. (TSXV: BCF) ("Builders", the "Company" or "we") today announced that it is offering rights (the "Rights Offering") to eligible holders of its Class A non-voting common shares (the "Class A Shares") of record at the close of business on October 28, 2022 (the "Record Date"). Pursuant to the Rights Offering, each holder of Class A Shares will receive one right (a "Right") for each Class A Share held. Every 3 Rights will entitle the holder to subscribe for one whole Class A Share of the Company at a price of $9.30 per Class A Share (the "Subscription Price"). There are currently approximately 2,000,000 Class A Shares outstanding. The Company expects the Rights Offering to close on November 28,2022 . The current shares were trading at $10 per share. Question 1 ( 2 points) What is the maximum amount that Builders Capital Mortgage could raise through this Rights Offering? $2.6 million $18.6 million $9.3 million $4.6 million $6.2 million Question 2 (2 points) Assuming that the share price of Builders Capital Mortgage on October 21st was $10, what would be the Value of the company if all the rights were exercised? $26.2 million $34.6 million $9.75 $18.3 million $20.45 million $24.7 milion Question 3 (2 points) Assuming the new value of Builders Capital Mortgage was $26 million (NOTE: this is not necessarily the answer to the previous question), what would be the ex-rights share price? $9.75 $8.84 $8.64 $10.00 $11.50 Question 4 (2 points) Assuming the Spruce Tree ex-price was $9.5 INOTE: this is not necessarily the answer to the previous question, what would be the value of one of its rights? $0.167 $0.155 $0.125 $0.175 $0.145

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Finance questions