1. Your manager, Paul requested that you explain to a client the basic elements of precedent transactions analysis. Provide the alternative name for the analysis, how the value is derived and how the information can be used. (4 Marks)

B & W Investment Bank (BWIB) is the lead broker for DiskPlus Limiteds (DPL) IPO. BWIB will be using a fully exercise over-allotment option of 15% for DLs IPO. BWIB will be underwriting 10 million shares at a price of $60 per share. The gross fee for the investment bank is 2%. After the offering the companys stock price increased to $62 per share. Use the green shoe option to calculate the funds BWIB will receive from this transaction. What amount will DPL receive? Provide explanations for your computations.