The firm currently has 2 million common shares outstanding


Company ABC is issuing new common shares in a rights offer in order to raise $10 million for a new project. The subscription price for each new share is $10. The firm currently has 2 million common shares outstanding, each priced at $25 in the market. What is the price of each right?

Select one:

a. $1

b. $2

c. $5

d. $10

e. $15

Solution Preview :

Prepared by a verified Expert
Finance Basics: The firm currently has 2 million common shares outstanding
Reference No:- TGS02635909

Now Priced at $10 (50% Discount)

Recommended (97%)

Rated (4.9/5)