Homework Answers
Enterprise value = Present value of all future free cash flows plus any non-operating assets
= 262.5/(1+09) + 262.5(1.3)/(1.09)^2 + 262.5(1.3)^2/(1.09)^3 + 262.5(1.3)^3/(1.09)^4 + 262.5(1.3)^4/(1.09)^5 + 262.5(1.3)^4(1.06)/(1.09)^5(9%-6%) + 31 million
= $18,983.33 + 31
= $19,014.33 million
Hence, the answer is $19,014 million
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