For an expansion into new markets, NewTech Building Ltd plans to raise $66 million to finance this
Fantastic news! We've Found the answer you've been seeking!
Question:
For an expansion into new markets, NewTech Building Ltd plans to raise $66 million to finance this expansion. The company will issue new shares of equity through a general cash offering to raise the funds.
- If the offer price of new shares is $23 per share and the company’s underwritiers charge a spread of 7.5%, how many shares need to be sold to raise the funds needed? Clearly show all steps, calculations and final answer. [Where applicable, round the final answer for a whole number of shares.]
2. In addition to the above, the filing fee and associated administrative expenses of the offering are $1,550,000. How many shares need to be sold now? Clearly show all steps, calculations and final answer. [Where applicable, round the final answer up for a whole number of shares.]
Related Book For
Fundamentals of corporate finance
ISBN: 978-0073382395
9th edition
Authors: Stephen Ross, Randolph Westerfield, Bradford Jordan
Posted Date: