12. High Voltage plc has 1 million ordinary shares with a nominal value of 50 pence and a market value of £4.00 each. The company makes a rights issue, offering existing shareholders one share for every 5 they already hold at a price of £3.50. After the rights issue, what is the theoretical value of the shares?

A. £3.50

B. £3.92

C. £4.70

D. £3.96

Answer : B