The Taussig Company, whose stock price is currently $28, needs to raise $15 million by issuing common

Question:

The Taussig Company, whose stock price is currently $28, needs to raise $15 million by issuing common stock. Underwriters have informed Taussig's management that it must price the new issue to the public at $27.53 per share to ensure that all shares will be sold. The underwriters' compensation will be 7 percent of the issue price, so Taussig will net $26.04 per share. The company will also incur expenses in the amount of $360,000. How many shares must Taussig sell to net $15 million after underwriting and flotation expenses?
Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Principles of Finance

ISBN: 978-1111527365

5th edition

Authors: Scott Besley, Eugene F. Brigham

Question Posted: