What is the loss to goldman shareholders

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Problem - Loss on the Conversion of Preferred Stock: Microsoft Corporation (Easy) In September 2008, in the midst of the credit crisis on Wall Street, Goldman Sachs invited Warren Buffett, the legendary fundamental investor, to contribute much-needed equity capital to the firm. Buffett seemingly got a very good deal. For a $5 billion cash infusion, he received perpetual preferred equity shares carrying a 10 percent dividend (redeemable by Goldman Sachs) plus warrants to buy 43 .5 million common shares at $115 per share (for a total of another $5 billion). The $115 conversion price was set at the current share price, a three-year low for Goldman. In June 2011, Goldman's shares traded at $136 each. If Buffet exercised the warrants at that price, what is the loss to Goldman's shareholders?

Reference no: EM132982786

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