Selkirk Electronics completed an IPO that was sold on a best-effort basis. The companys investment bank received

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Selkirk Electronics completed an IPO that was sold on a best-effort basis. The company’s investment bank received a spread of 7 percent of the offer price, which was set at $24 per share. Two million shares were issued, however, the bank was overly optimistic and eventually was able to sell the stock for an average price of $23.60 per share. What were the proceeds for the issuer and the underwriter?

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Fundamentals of corporate finance

ISBN: 978-0470876442

2nd Edition

Authors: Robert Parrino, David S. Kidwell, Thomas W. Bates

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