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@vatalya said:
How did you guys get 157m for apv I had single digits sigh… I thought I did well in this paper but now I don’t think so.. I know where I fell down was calculating the growth on the fcf for Tai as a perpetuity. I didn’t remember that foreseeable future was perpetuity.. I was thinking one year growth… I wonder how many marks were at risk for that growth
calculation. What did you guys say Tai would prefer as an acquisition offer?

My APV was also 157m
Regarding first question, Tai was perpetuity but I think the combined was not as combined was growing at 4.2% after the 4th year

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@niccpx said:
I calculated value of Tai co using free cash flow method, and deducted 400m debt (market value) to get value of equity of Tai co. And took this figure to divide by number of shares. Share price of Tai co is $3.80, if not mistaken

I did the same and got $3.8
FOR Pao I think the total equity value was 5000

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I also did exactly. Hope finger crossed

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I think the total equity value after debt was 1000 and Pao 5000

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I don’t know if i did right but, For part b I think half of the answer were given in the question itself ? Just needed to explain it with concept.

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I don’t exactly remember but I think APV was 157m
Did you calculate PV of Tax lost on govt debt interest?
Also did you find the bank loan repayments by taking AF for 4 yrs risk free rate (I think can’t remember )AF 3.363, then calculated the 4 yrs bank interest,
And then discounted bank plus govt interests in order to get pv of interest ??
Thats how i calculated

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I think 157m positive. I cannot remember exactly

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Did you calculate PV of Tax lost on govt debt interest?
Also did you find the bank loan repayments by taking AF for 4 yrs risk free rate (I think can’t remember )AF 3.363, then calculated the 4 yrs bank interest
And then discounted bank plus govt interests in order to get pv of interest ??

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I think issue cost was not tax allowable for tax. It was stated in the question.

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If you receive CHF and contract size is also in CHF , then you don’t need to divide. My contact size was 98.
However Company was USA based and they needed to convert into dollar so you needed to divide in order to received in US$.
Not sure if I did right

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I used given Ba on CAPM gives 12% I think (cannot remember)

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I divided by 6 months future (buy dollar rate)

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Thank you Surajnair!
Do you know any recent Article?

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Sorry! I got the answer

14% = 4.5% + Beta x 4%
(14% – 4.5%) = 4%Beta
9.5%/4% = 2.375

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