ZuoTi.Pro
Question

Katie Homes and Garden Co. has 14,800,000 shares outstanding. The stock is currently selling at $82 per share. If an unfriendly outside group acquired 30 percent of the shares, existing stockholders will be able to buy new shares at 35 percent below the currently existing stock price. a. How many shares must the unfriendly outside group acquire for the poison pill to go into effect? (Do not round intermediate calculations.) Number of shares b. What will be the new purchase price for the existing stockholders? (Do not round intermediate calculations. Round your answer to 2 decimal places.) New purchase priceKatie

business   accounting   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1
a
Number of shares = 14800000*30%= 4440000
b
New purchase price = 82*(1-0.35)= $53.30
0 0
Add a comment
Know the answer?
Add Answer to:
Katie Katie Homes and Garden Co. has 14,800,000 shares outstanding. The stock is currently selling at...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • Roll Corporation (RC) currently has 505,000 shares of stock outstanding that sell for $80 per share....

    Roll Corporation (RC) currently has 505,000 shares of stock outstanding that sell for $80 per share. Assuming no market imperfections or tax effects exist, what will the share price be after: a. RC has a four-for-three stock split? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) New share price $ b. RC has a 20 percent stock dividend? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)...

  • The Harpe Company currently has 239,000 outstanding shares selling at $148 each. The firm is contemplating...

    The Harpe Company currently has 239,000 outstanding shares selling at $148 each. The firm is contemplating the declaration of a dividend of $3 at the end of the fiscal year that just began. Assume there are no taxes on dividends. Answer the following questions based on the Miller and Modigliani model, which is discussed in the text a. What will be the price of the stock on the ex-dividend date if the dividend is declared? (Do not round intermediate calculations.)...

  • The Harpe Company currently has 237,000 outstanding shares selling at $144 each. The firm is contemplating...

    The Harpe Company currently has 237,000 outstanding shares selling at $144 each. The firm is contemplating the declaration of a dividend of $3 at the end of the fiscal year that just began. Assume there are no taxes on dividends. Answer the following questions based on the Miller and Modigliani model, which is discussed in the text. a. What will be the price of the stock on the ex-dividend date if the dividend is declared? (Do not round intermediate calculations.)...

  • Mill Creek Corporation (MCC) currently has 475,000 shares of stock outstanding that sell for $80 per...

    Mill Creek Corporation (MCC) currently has 475,000 shares of stock outstanding that sell for $80 per share. Assuming no market imperfections or tax effects exist, what will the share price be after: a. MCC has a four-for-three stock split? (Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.) New share price ? b. MCC has a 20% stock dividend? (Do not round intermediate calculations. Round the final answer to 2...

  • An entrepreneur founded a company (ABC) in 2001. Recently, the stock was trading at $41per share....

    An entrepreneur founded a company (ABC) in 2001. Recently, the stock was trading at $41per share. With 850k shares outstanding, EPS were $1.41. The entrepreneur and the members of the board of directors were initially pleased when another firm purchased 50k shares of ABC stock. However, when the purchasing firm bought another 50k shares, the entrepreneur and members of the board became concerned that the purchasing firm might be trying to take over ABC The entrepreneur was reminded by the...

  • An entrepreneur founded a company (ABC) in 2001. Recently, the stock was trading at $42per share....

    An entrepreneur founded a company (ABC) in 2001. Recently, the stock was trading at $42per share. With 850k shares outstanding, EPS were $1.41. The entrepreneur and the members of the board of directors were initially pleased when another firm purchased 50k shares of ABC stock. However, when the purchasing firm bought another 50k shares, the entrepreneur and members of the board became concerned that the purchasing firm might be trying to take over ABC. The entrepreneur was reminded by the...

  • Louisiana Timber Company currently has 4 million shares of stock outstanding and will report earnings of...

    Louisiana Timber Company currently has 4 million shares of stock outstanding and will report earnings of $6.71 million in the current year. The company is considering the issuance of 2 million additional shares that will net $39 per share to the corporation. a. What is the immediate dilution potential for this new stock issue? (Do not round intermediate calculations and round your answer to 2 decimal places.)    b-1. Assume the Louisiana Timber Company can earn 10.80 percent on the...

  • American Health Systems currently has 6,400,000 shares of stock outstanding and will report earnings of $10...

    American Health Systems currently has 6,400,000 shares of stock outstanding and will report earnings of $10 milion in the current year. The company is considering the issuance of 1,700,000 additional shares that will net $30 per share to the corporation. a. What ls the immediate dilution potential for this new stock issue? (Do not round intermediate calculations and round your answer to 2 decimal places.) ints Dilution per share b-1. Assume that American Health Systems can ean 9 percent on...

  • The Wall Company has 142,500 shares of common stock outstanding that are currently selling at $28.63....

    The Wall Company has 142,500 shares of common stock outstanding that are currently selling at $28.63. It has 4,640 bonds outstanding that won't mature for 20 years. They were issued at a par value of $1,000 paying a coupon rate of 6%. Comparable bonds now yield 9%. Wall's $100 par value preferred stock was issued at 8% and is now yielding 13%; 8,500 shares are outstanding. Assume that the coupon payments are semi-annual. Develop Wall's market value based capital structure....

  • Wayne, Inc., wishes to expand Its facilities. The company currently has 5 million shares outstanding and...

    Wayne, Inc., wishes to expand Its facilities. The company currently has 5 million shares outstanding and no debt. The stock sells for $36 per share, but the book value per share Is $8. Net income is currently $4 million. The new facility will cost $45 million, and It wll Increase net Income by $780,000. Assume a constant price-earnings ratio. a-1. Calculate the new book value per share. (Do not round intermediate calculations and round your answer to 2 declmal places,...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT