Issue costs example

Issue costs example - → Plus administrative costs of $9.2...

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Parker Planners BusM 402 Issue costs: Goldman Sachs’ IPO Goldman Sachs went public in 1999. The underwriters acquired 69 million shares for $50.75, and sold them at an offer price of $53.00. Legal fees and other administrative costs amounted to $9.2 million. Goldman’s stock closed at $70 on the first day of trading. Direct costs: Underwriting spread = $2.25 X 69 million shares = $155.25 M
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Unformatted text preview: → Plus administrative costs of $9.2 million = $164.45 M • Underpricing = $17 X 69 million shares = $1,173 M • Net funds to company = $53 X 69 million = $3,657 M less direct costs of $164.45 M = $3,492.55 million See Brealey, et al Fundamentals of Corporate Finance pp. 401-402...
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This note was uploaded on 03/01/2012 for the course BUS M 410 taught by Professor Brianboyer during the Fall '10 term at BYU.

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