Ren-Stimpy International is planning to raise fresh equity capital by selling a large new issue of common stock.

Ren-Stimpy International is planning to raise fresh equity capital by selling a large new issue of common stock. Ren-Stimpy is currently a publicly traded corporation, and it is trying to choose between an underwritten cash offer and a rights offering (not underwritten) to current shareholders. Ren-Stimpy management is interested in minimizing the selling costs and has asked you for advice on the choice of issue methods. Recommend what Ren-Stimpy should do. Provide a detailed rationale.