A company is going public at $14 and will use the ticker XYZ. The underwriters...
50.1K
Verified Solution
Link Copied!
Question
Accounting
A company is going public at $14 and will use the ticker XYZ. The underwriters will charge a 7 percent spread. The company is issuing 22 million shares, and insiders will continue to hold an additional 44 million shares that will not be part of the IPO. The company will also pay $1.5 million of audit fees, $3 million of legal fees, and $700,000 of printing fees. The stock closes the first day at $17. Answer the following questions:
a. At the end of the first day, what is the market capitalization of the company? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Do not round intermediate calculations. Round your answer to one decimal place.
$ million
b. What are the total costs of the offering? Include underpricing in this calculation. Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Do not round intermediate calculations. Round your answer to one decimal place.
$ million
please answer a and b please thanks!
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
