Flancrest Corporation’s free cash flow during the just-ended year (t = 0) was $210 million, and its FCF is expected to grow at a constant rate of 6.0% in the future. If the weighted average cost of capital is 11.2%, what is the firm’s total corporate value, in millions? Please show work.
Total corporate value=Free cash flow for next period/(WACC-Growth Rate)
=(210*1.06)/(0.112-0.06)
which is equal to
=$4280.77 million(Approx).
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