Intrinsic stock price per share after repurchase

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Suppose SSC has decided to distribute $50 million, which it presently is holding in very liquid short-term investments. SSC's value of operations is estimated to be about $1,937.5 million, and it has $387.5 million in debt (it has no preferred stock). As mentioned previously, SSC has 100 million shares of stock outstanding.

(1) Suppose instead that SSC has just made a $50 million distribution in the form of a stock repurchase. Now what is SSC's intrinsic value of equity? How many shares did SSC repurchase? How many shares remained outstanding after the repurchase? What is its intrinsic stock price per share after the repurchase?

Reference no: EM13125219

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