Raven Co. has just gone public. Under a firm commitment agreement, Raven received $21.39 for each of the 20 million shares sold. The initial offering price was $23 per share, and the stock rose to $28.41 per share in the first few minutes of trading. Raven paid $950,000 in direct legal and other costs and $320,000 in indirect costs. What was the flotation cost as a percentage of funds raised

Q: Please answer this question step by step: * Prahm Corp. wants to raise $3.9 million via a rights…

A: Amount raised = $3,900,000 Shares outstanding = 450,000 Current price = $40 Subscription price = $15…

Q: Tundra Technologies (TT) was founded two years ago with a $100,000 investment for 2.0 million common…

A: The pre and post money valuation are two techniques used to ascertain investment value where…

Q: Beedles Inc. needed to raise $14 million in an IPO and chose Security Brokers Inc. to underwrite the…

A: Amount to be paid to Beedles Inc = $14 million or $14,000,000Number of shares to be issued = 3…

Q: The Telwar Company has just gone public. Under a firm commitment agreement, the company received…

A: 1-Net amount raised =4,150,000*$32.50 -$910,000-$260,000=$133,705,000.2-Total direct cost…

Q: Bullant Inc. has decided to go public and has sold 2 million of its shares to its underwriter for…

A: Cost of issue = [ Price after listing - Price at which shares are sold to underwriters ] * Number of…

Q: On January​ 20, Sullivan ​Inc., sold 10 million shares of stock in an SEO. The market price of…

A: Information providedMarket price = $40.25Number of shares sold by Sullivan = 4 million or…

Q: Pawprints Paint recently went public in a best efforts offering. The company offered 165,000 shares…

A: Shares offered to sell = 165,000 sharesActual number of shares sold =158,700 sharesOffer price per…

Q: The Elkmont Corporation needs to raise $51.1 million to finance its expansion into new markets. The…

A: Required proceeds net of spread=(51,100,000+SEC filing fee and associated administrative…

Q: Stump, Inc. issues a $66 million IPO priced at $17 per share, and the offering price to the public…

A: It represents the expenditures associated with underwiring and issuing securities like equity &…

Q: Tundra Technologies (TT) was founded two years ago with a $100,000 investment for 2.0 million common…

A: The post money valuation for round 3 will be made using the share price for the corporation at round…

Q: The Sugarland Co. has just gone public. Under a firm commitment agreement, the company received…

A: Floatation costs: The cost incurred by the company when new stock is issued is known as floatation…

Q: d) Suppose that the company was also considering structuring the rights issue to allow for an…

A: Right issue: Right issue can be defined as the method where the existing shareholders of the company…

Q: Under a firm commitment agreement, Zeke, Co. went public and received $29.75 for each of the 6.7…

A: The objective of the question is to calculate the flotation cost as a percentage of funds raised by…

Q: Beedles Inc. needed to raise $14 million in an IPO and chose Security Brokers Inc. to underwrite the…

A: IPO refers to the first-ever public offering. It is the procedure by which a privately held business…

Q: Corporation Ltd is considering raisng additional equiry via a rights issue, in the amount of…

A: Existing shareholders are extended an opportunity to acquire extra new shares of the firm via the…

Q: A firm goes public. The firm receives $35 for each of the 7.75 million shares sold. The initial…

A: An underwriting spread is the gross value earned by underwriters when the company goes public. It is…

Q: Corporation Ltd is considering raisng additional equiry via a rights issue, in the amount of…

A: Existing shareholders are extended an opportunity to acquire extra new shares of the firm via the…

Q: Moonscape has just completed an initial public offering The firm sold three million shares at on…

A:

Q: Beedles Inc. needed to raise $14 million in an IPO and chose Security Brokers Inc. to underwrite the…

A: Computation of Profit/ Loss : a) Profit or loss = (Number of shares * Price) - Proceeds to Beedles -…

Q: National Financial Services, Inc. invested $30,000 to acquire 3,750 shares of Stonebridge…

A: If the shares sold with a increased price than the purchased price the gain on sale of shares will…

Q: Aruba Corporation-recently organized. The company issued common stock to an inventor in exchange for…

A: Total paid-in capital means the amount which indicates the total shareholdings of the shareholders…

Q: orporation wants to raise $3.9 million via a rights offering. The company currently has 470,000…

A: Given,Spread charge = 5%Subscription price=$23 per shareNumber of shares currently have=470000…

Q: DRK, Incorporated, has just sold 80,000 shares in an initial public offering. The underwriters…

A: The total cost of the equity issue will include explicit cost and implicit cost.

Q: Margoles Publishing recently completed its IPO. The stock was offered at a price of $14.14 per…

A: Issue of common stock is one of the ways in which the companies can raise funds for financing the…

Q: Angina Inc. has 5 million shares outstanding. The firm is considering issuing an additional 1…

A: Calculate the net proceedings as follows:

Q: On January 20, Metropolitan Inc. sold 9 million shares of stock in an SEO. The market price of…

A: Company raises money from the market by selling the shares in the market and selling shares is cost…

Q: A company has 20,858,702 shares outstanding. In an IPO, the firm issued 3,000,000 new shares. The…

A: Since we only answer up to 3 sub-parts, we’ll answer the first 3 sub-parts of the first question.…

Q: Johnson Limited wants to raise $5.1 million via rights offering and appointed Rough Investment as…

A: Renouncing your rights:- Renouncing your rights means an investor is not interested in the rights…

Q: The Telwar Company has just gone public. Under a firm commitment agreement, the company received…

A: Solution:Floatation cost refers to the cost incurred by a company while issuing its securities in…

Q: A firm goes public. The firm receives $35 for each of the 7.75 million shares sold. The initial…

A: Underwriter's spread refers to the difference between the price at which an underwriter acquires…

Q: Margoles Publishing recently completed its IPO. The stock was offered at a price of $14.63 per…

A: Company not listed on stock exchanges goes to public by issue of shares to market through…

Q: Moonscape has just completed an initial public offering. The firm sold 4 million shares at an offer…

A: Number of shares issued: 4,000,000Price per share: $10Underwriting spread: $0.60Clsoing price:…

Q: Moonscape has just completed an initial public offering. The firm sold 3 million shares at an offer…

A: Number of shares = 3 million = 3,000,000Offer price = $12 per shareUnderwriting price = $0.30 per…