Budding Flowers inc. needs to raise 520 million to build new greenhouses. They will issue...
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Budding Flowers inc. needs to raise 520 million to build new greenhouses. They will issue new shares through a rights offering to their common shareholders. There are 4 milion outstanding common shares and one right will be issued per common share. The subscription price is $20 per share and the current market price of their common shares is $25. 1. How many rights are required to acquire 1 new common share? 2. What is the value of a right? 3. If the stock goes ex-rights, what would be the new stock price
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