StemCells Inc. Floats More Stock

StemCells, Inc. announced it has entered into agreements to sell approximately 11.75 million shares of its common stock to "selected institutional investors" at a price of $3.05 per share. The company expects to "receive total proceeds, net of offering expenses and placement agency fees, of approximately $33 million."

On 31 March 2006, STEM shares closed at $3.58 per share. {Quote.Yahoo.com:: STEM}

Exercises

1. Calculate total "offering expenses and placement agency fees."

2. The $3.05 per share price was ________% lower than the 31 March 2006 closing per share price.

3. With it stock priced at $3.16 per share, the company had an approximate market value of $206.67 million. Calculate how many STEM shares there are outstanding. [market value = stock price x #shares]

4. The sale of 11.75 million shares will increase the total number of shares outstanding by _______%. [This question requires the correct answer 64,401,898 from the previous question.]

5. Prior to the stock sale, StemCells Inc.'s balance sheet showed a cash position of approximately $34.54 million. After the stock sale, the company's cash position will approximate $_______________.

6. Zelmo Zeroman purchased 50 shares of STEM at $3.09 per share plus a $7 transaction fee. Zelmo will pay another $7 when he sells his STEM shares. Calculate what price STEM must reach before Zelmo's investment shows a profit.

External Hyperlinks

• Wikipedia.org:: Stem cell
• NIH.gov:: Stem Cell Information
• StemCellsInc.com:: Home Page

Creator: Gerald D. Thurman [gdt@deru.com]
Created: 03 April 2006