a) After your Bachelor degree, you apply for a traineeship at Evotec SE. Your first challenging...

Transcribed Image Text:

a) After your Bachelor degree, you apply for a traineeship at Evotec SE. Your first challenging task is a free cashflow valuation of Evotec SE. The accounting team provides the following information: Cash: 109 Mio. ; Debt: 347 Mio. ; Outstanding Shares: 149 Mio.; WACC 14% From the controlling department, you receive the following financial forecast of free Cashflows and a long-term growth rate of 12%: Year Free Cash Flow (in Mio. ) 1 2 3 4 90,00 100,00 113,00 125,00 Calculate the enterprise Value of Evotec SE and the price per share for to. b) Suppose Evotec SE borrows 30 Mio. by issuing 10-year coupon bonds with an annual interest payment of 5%. Assume a marginal tax rate of 30%. Assume that tax savings are as risky as the debt that creates them. By how much does the interest tax shield increase the value of Evotec SE? a) After your Bachelor degree, you apply for a traineeship at Evotec SE. Your first challenging task is a free cashflow valuation of Evotec SE. The accounting team provides the following information: Cash: 109 Mio. ; Debt: 347 Mio. ; Outstanding Shares: 149 Mio.; WACC 14% From the controlling department, you receive the following financial forecast of free Cashflows and a long-term growth rate of 12%: Year Free Cash Flow (in Mio. ) 1 2 3 4 90,00 100,00 113,00 125,00 Calculate the enterprise Value of Evotec SE and the price per share for to. b) Suppose Evotec SE borrows 30 Mio. by issuing 10-year coupon bonds with an annual interest payment of 5%. Assume a marginal tax rate of 30%. Assume that tax savings are as risky as the debt that creates them. By how much does the interest tax shield increase the value of Evotec SE?