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The Metallica Heavy Metal Mining (MHMM) Corporation wants to diversify its operations. Some recent financial information for the company is shown here: Stock price $
The Metallica Heavy Metal Mining (MHMM) Corporation wants to diversify its operations. Some recent financial information for the company is shown here: Stock price $ 75 Number of 64,000 shares Total assets $9,400,000 Total liabilities $ 4,100,000 Net income $ 980,000 MHMM is considering an investment that has the same PE ratio as the firm. The cost of the investment is $1,500,000, and it will be financed with a new equity issue. (Do not round intermediate calculations. Enter your ROE answer as a percent rounded to 2 decimal places, e.g., 32.16. Leave no cells blank - be certain to enter "O" wherever required.) The ROE on the investment would have to be percent if we wanted the price after the offering to be $75 per share (assume the PE ratio still remains constant), and the NPV of the investment would be Accounting dilution occur in this case. Market value dilution occur in this case
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