Marseille Manufacturing (MM) is considering an IPO. MM currently has 13 million shares outstanding and I currently own 8 million of those shares. MM plans to sell 3 million shares in the IPO. If all the new shares are primary shares, then what will my new ownership percentage be? If I decide to replace some of the primary shares with some of my shares as secondary shares in the IPO, then how many of my shares can I sell and still maintain 50% ownership?
Marseille Manufacturing (MM) is considering an IPO. MM currently has 13 million shares outstanding and I currently own 8 million of those shares. MM plans to sell 3 million shares in the IPO. If all the new shares are primary shares, then what will my new ownership percentage be? If I decide to replace some of the primary shares with some of my shares as secondary shares in the IPO, then how many of my shares can I sell and still maintain 50% ownership?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Marseille Manufacturing (MM) is considering an IPO. MM currently has 13 million shares outstanding and I currently own 8 million of those shares. MM plans to sell 3 million shares in the IPO. If all the new shares are primary shares, then what will my new ownership percentage be? If I decide to replace some of the primary shares with some of my shares as secondary shares in the IPO, then how many of my shares can I sell and still maintain 50% ownership?
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