The firm you founded currently has 10 million shares of which you own 6 million

Finance Dec 22, 2020

The firm you founded currently has 10 million shares of which you own 6 million. You are considering an IPO where you would sell 3 million shares for RM30 each.

i. If all shares sold are primary shares, find the amount that the firm raise. (2 marks)

ii. Calculate your percentage ownership of the firm after the IPO. (2 marks)

Expert Solution

i. amount raised by the firm = 3 million * 30 = 90 million RM

ii. total shares owned = 6 - 3 = 3 million

new stake = 3/10 = 30%

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