Hoobastink Mfg. is considering a rights offer. The company has determined that the ex-rights price will be $61. The current price is $68 per share, and there are 10 million shares outstanding. The rights offer would raise a total of $60 million. What is the subscription price?© BrainMass Inc. brainmass.com March 4, 2021, 10:31 pm ad1c9bdddf
Let P be the subscription price.
First let us calculate the number of new shares that will be issued
The number of new shares = the amount ...
The solution explains how to calculate the subscription price in a rights issue.