Rights Offerings Again, Inc., is proposing a rights offering. Presently, there are 450,000 shares outstanding at $90 each. There will be 80,000 new shares offered at $84 each.
a.What is the new market value of the company?
b.How many rights are associated with one of the new shares?
c.What is the ex-rights price?
d.What is the value of a right?
e.Why might a company have a rights offering rather than a general cash offer?
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