Raybac Is About to Go Public

question 19

Multiple Choice

Raybac is about to go public.Its present shareholders own 500,000 shares.The new public issue will represent 800,000 shares.The shares will be priced at $25 to the public with a 4% spread.The out-of pocket costs will be $450,000.What is the net proceeds to the firm?

• A) $18,750,000
• B) $19,200,000
• C) $18,250,000
• D) $19,550,000