Before the rights offer the company has two million shares


Please provide explanation:

Company XYZ is issuing 500,000 new shares in a rights offer. The company wants to ensure that the ex-rights share price is $75. Before the rights offer, the company has two million shares outstanding. If the rights were each priced at $10, what is the subscription price?

Select one:

a. $20

b. $25

c. $30

d. $35

e. $40

Solution Preview :

Prepared by a verified Expert
Business Management: Before the rights offer the company has two million shares
Reference No:- TGS02633264

Now Priced at $10 (50% Discount)

Recommended (92%)

Rated (4.4/5)