1. MAX Inc. has set its IPO price at $28 per share. It is offering...
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1. MAX Inc. has set its IPO price at $28 per share. It is offering 42,500,000 shares in its IPO. The lead underwriter is to get a total spread of 550 bp and is allotted 18,500,000 shares. The rest of the selling group of investment banks (three in all) split the remaining shares evenly, and receive 260 bp for their selling efforts. Assume all shares offered are sold.
a. How large is RBNs IPO?
b. What are the proceeds to RBN from its IPO?
c. How much does the lead underwriter net for the IPO?
d. How much does each of the other eight investment banks receive for the IPO?
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