FIN515_W7_Project_BBridges

a. Net Operating Working Capital=($5,600,000 + $56,200,000 + $112,400,000)

= $174,200,000
Net Plant and Equipment= ($11,200,000 + $28,100,000)
= $39,300,000
Operating Capital= $174,200,000-$39,300,000
= $134,900,000
Total Operating Capital=$134,900,000+397,500,000
=$532,400,000
Change in operating Capital= $532,400,000 - $502,200,000
= $30,200,000
FCF= $65,160,000-$30,200,000
=$34,960,000
b. Horizon value=FCFn(1 + g) / (WACC g)
=34,960,000(1+.06)/(.11-.06)
=$37,057,600/.05
=$741,152,000
c.

Value of operations=FCF/(1 + WACC )

=$741,152,000/(1+.06)
=$699,200,000

d. Total Value of the Company= Value of operations+Marketable Securities

=$699,200,000+$49,900,000(given in balance sheet)
=$749,100,000
e. Price per share= (Total Value (Notes payable + long-term debt) preferred stock)/number of
shares
=($749,100,000-($69,900,000+$140,800,000)-$35,000,000)/10,000,000
=($749,100,000-($210,700,000)-$35,000,000)/10,000,000
=$538,400,000/10,000,000
=$50.34