Details of this Paper

Lee Manufacturing's value of operations is equal t...

Description

Solution


Question

Lee Manufacturing's value of operations is equal to $900 million after a recaptitalization (the firm had no debt before the recap). Lee raised $300 million in new debt and used this to buy back stock. Lee had no short-term investments before or after the recap. After the recap, wd = 1/3. The firm had 30 million shares before the recap. What is P (the stock price after the recap)? (Answer steps required in excel)

 

Paper#8686 | Written in 18-Jul-2015

Price : $25
SiteLock