Question: Cash Offer versus Rights Offer McCanless International is planning to raise fresh equity capital by selling a large new issue of common stock. McCanless is

Cash Offer versus Rights Offer McCanless International is planning to raise fresh equity capital by selling a large new issue of common stock. McCanless is currently a publicly traded corporation, and it is trying to choose between an underwritten cash offer and a rights offering (not underwritten) to current shareholders. McCanless’s management is interested in minimizing the selling costs and has asked you for advice on the choice of issue methods. What is your recommendation and why?

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