Lulu Industries is in the process of selling shares in an auction IPO. At the end of the bidding period, Lulu'sinvestment bank has received the following bids:Number of Shares Bid50,00025,00025,000100,000125,000Price ($)$19.50$19.25$19.10$19.00$18.75$18.50$18.25$18.00$17.75$17.50What will the offer price of these shares be if Lulu is selling 0.5 million shares?$18.75$19.10$18.5075,000150,000240,00080,000125,000$18.25

Given: Bid Price Shares $19.50 50,000 $19.25 25,000 $19.10 25,000 $19.00…

Answered: Lulu Industries is in the process of…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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David's Watersports Firm is considering a public offering of common stock. Its investment banker has informed the company that the retail price will be $16.85 per share for 550,000 shares. The company will receive $15.40 per share and will incur $180,000 in registration, accounting, and printing fees. A. What is the spread on this issue in percentage terms? What are the total expenses of the issue as a percentage of total value (at retail)? B. If the firm wanted to net $15.99 million from this issue, how many shares must be sold?
In a recent IPO, a social network company issued 4,000,000 new shares. The initial price to the public was £22.00 per share. The final first-day closing price was £52.37. If the investment bankers retained £1.45 per share as fees, what was the net proceeds to the social network firm and its market capitalisation? Select one: O a. Net proceeds: £93,800,000; Market capitalisation: £203,680,000 O b. Net proceeds: £88,000,000; Market capitalisation: £88,000,000 O c. Net proceeds: £82,200,000; Market capitalisation: £209,480,000 Od. Net proceeds: £83,200,000; Market capitalisation: £219,480,000
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K Roundtree Software is going public using an auction IPO. The firm has received the following bids: Price ($) Number of Shares 14.00 120,000 13.80 200,000 13.60 560,000 13.40 1,100,000 13.20 1,300,000 13.00 12.80 800,000 440,000 Roundtree had previously believed it would issue 2,000,000 shares; however, if Roundtree decides to issue an extra 504,000 shares (for a total of 2,504,000 shares), Roundtree will raise a total amount of $33.1 million. (Round to one decimal place.)
Margoles Publishing recently completed its IPO. The stock was offered at a price of $14.14 per share. On the first day of trading, the stock closed at $19.15 per share. If Margoles Publishing paid an underwriting spread of 7.3% for its IPO and sold 6 million shares, what was the total cost (exclusive of underpricing) to the company of going public? The total cost of going public was $ million. (Round to one decimal place.)
On August 19, 2004, Google completed its IPO of 18.5 million shares to the initial investors at $80 per share. The closing price of the stock that same day was $100.00. What was the dollar value of the underpricing associated with the Google IPO? (Round answer to 0 decimal places, e.g. 5,275.)
Baghiben
Please show all equations and work as needed. Make the correct answer clear. If possible, please type work so it can be copied. Thank you.
M106.
Suppose a Sam's company in CA, completes an $95 million IPO priced to the public at $50 per share. The firm receives $47 per share, and the out-of-pocket expenses are $480,000. The stock’s closing price at the end of the first day is $59. What is the total cost to the firm of issuing the securities? $_______
Wellington Seafood Company would like to sell 4,000 shares of stock to acquire its competitor Kapiti Crab Inc. The manager decides to use Dutch auction underwriting. The bids received are: Bidder ABCDE O $32,340 How much should bidder A need to pay if the bidder receives the allocated shares? Ⓒ $31,405 O $25,124 Quantity 1100 900 1,450 1,550 1,750 O $25,872 Price $29.40 29.05 28.90 28.55 28.35
A hypothetical corporation, Cascade Strategic & Innovative Solutions, has decided to raise capital through a rights offering. The company has 2,000,000 outstanding shares of stock with a market value of $55 per share. Cascade would like to raise an additional $15,000,000 in capital through a rights offering. The company will set the subscription price at $25 per new share. How many rights will be required to purchase 30 shares? 300 rights 10 rights 30 rights O 100 rights

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