Financial Management: Theory & Practice
Financial Management: Theory & Practice
15th Edition
ISBN: 9781337248006
Author: Eugene F. Brigham; Michael C. Ehrhardt
Publisher: Cengage Learning US
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Chapter 18, Problem 9MC
Summary Introduction

Case summary: Person R wants to expand its business by raising $18.3 million through sell of common stock. The business has 50% of debt ratio and family of Person R invested personal wealth into the business. The family wants to retain controlling right.

To compute: The spread between the price new investor pays and proceeds to the company, value of sold stock, total post-IPO value of equity, percentage of requirement by new investor along with number of shares and estimated offer price per share.

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