27. A private equity group who wants to purchase all of the company’s assets would be willing to pay approximately __________. Do not use the DDM. Use either FCFF or FCFE, whichever is appropriate.
-
$9,583M
-
$10,222M
-
$10,518M
-
$17,969M
-
$19,167M
Homework Answers
Cost of capital WACC=600/1000*20%*(1-35%)+400/1000*30%=19.8%
Enterprise Value=750*(1+15%)/(19.8%-15%)=17969 M
Option D
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