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Rise plc is proposing a rights offering. Presently there are 261,000 shares outstanding at £85 each....

Rise plc is proposing a rights offering. Presently there are 261,000 shares outstanding at £85 each. There will be 87,000 new shares offered at £70 each.
1) What is the new market value of the company?
2) How many rights are associated with one of the new shares?
3) What is the ex-rights price?
4) What is the value of a right?
5) Why might a company have a rights offering rather than a general cash offer.
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Answer #1

1 Blu e h85 87000 @ EVO la) The new market value will be: - 26,000 Shares & h 85 + 87000 new shares x to 7o = h 22, 185,000 t(c) The new price of the stock will be the new market value of the Company divided by the total number of shares outstanding

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