Valley plc has issued share capital of 2 million ordinary shares, par value 1.00. The board of the company has decided it needs to raise 1m, net of issue costs, to finance a new product. It has been suggested that the additional finance be raised by means of a 1 for 4 rights issue. The issue price will be at a 20 per cent discount to the current market price of 2.75 and issue costs are expected to be 50 000. Calculate and explain the following: The value of the rights