Amount of Shares Sold Assignment | Homework For You
May 27th, 2020
The Beranek Company, whose stock price is now $30, needs to raise $30 million in common stock. Underwriters have informed the firm’s management that they must price the new issue to the public at $25 per share because of signaling effects. The underwriters’ compensation will be 5% of the issue price, so Beranek will net $23.75 per share.
The firm will also incur expenses in the amount of $150,000. How many shares must the firm sell to net $30 million after underwriting and flotation expenses? Do not round intermediate calculations. Write out your answer completely. For example, 5 million should be entered as 5,000,000. Round your answer to the nearest whole number. Get Finance homework help today

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