- 5 Your Company Aims At Acquiring Another Company With The Limited Information Available You Try To Do A Back Of The En 1 (96.1 KiB) Viewed 37 times
5 Your company aims at acquiring another company With the limited information available, you try to do a 'back-of-the-envelope' valuation The target company currently has an NOCF of €113 min per year, and their WACC is 8.8% The first annual NOCF will arrive in exactly 1 year from now. Assume the current NOCF and WACC remain constant, but also assume the target company will cease its operations after 13.0 years (so if you toke If over today, you will cam 13 0 times the annual NOCF for the years to come, with the first NOCF arriving exactly 1 year from now). 0 5p a How much is the target company worth as per today (at t=0)? Give in your final answer in millions of euros, rounded to two decimal places, Ignore the currency sign, and use a decimal point Example: You calculate a value of €123.456789 min, and give in 123.46 Answer 0.5p b Assume the current NOCF and WACC remain constant forever How much is the target company worth per today (at t=0)? Give in your final answer in millions of euros, rounded to two decimal places. Ignore the currency sign, and use a decimal point Example You calculate a value of €123.456789 mln, and give in: 123.46 Answer 0.5p Assume the current WACC remains constant forever, but if you manage to revitalise the target company. then from next year onwards, the NOCF will grow at 23% per annum forever (so, the first NOCF after the takeover has grown by 2 3% relative to the last available one) How much is the target company worth (at t=0) if your planned revitalisation will take place succesfully? Give in your final answer in millions of curos, rounded to two decimal places. Ignore the currency sign, and use a decimal point Example: You calculate o value of €123.456789 min, and give in: 123.46 Answer 05pd How much is your revitalisation worth (as per t=0)? Give in your final answer in millions of euros, rounded to two decimal places. Ignore the currency sign, and use a decimal point Example: You calculate a value of €123456789 min, and give in 12.35 Answer