red shoe co. has concluded that additional equity financing will be needed to expand operations and...

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red shoe co. has concluded that additional equity financing willbe needed to expand operations and that the needed funds will bebest obtained through a rights offering. It has correctlydetermined that as a result of the rights offering, the share pricewill fall from $49 to $47.60 ($49 is the rights on price $47.60 isthe ex rights price also known as the when issued price) thecompany is seeking 16.5 million in additional funds with a pershare subscription price equal to $34. how many shares are therecurrently before the offering? (assume that the increment to themarket value of the equity equals the gross proceeds from theoffering)

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Subscription Price per share 34 Amount the company is willing to raise 165 million Number of shares that the company will have to issue in order to raise the required amount 165 million 34 shares well See Answer

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red shoe co. has concluded that additional equity financing willbe needed to expand operations and that the needed funds will bebest obtained through a rights offering. It has correctlydetermined that as a result of the rights offering, the share pricewill fall from $49 to $47.60 ($49 is the rights on price $47.60 isthe ex rights price also known as the when issued price) thecompany is seeking 16.5 million in additional funds with a pershare subscription price equal to $34. how many shares are therecurrently before the offering? (assume that the increment to themarket value of the equity equals the gross proceeds from theoffering)