Question: Electrosoft has no debt and its shareholders require a return of 11%. There are 150 million shares outstanding, and the shares trade for $9. ElectroSoft

Electrosoft has no debt and its shareholders require a return of 11%. There are 150 million shares outstanding, and the shares trade for $9. ElectroSoft has announced a stock repurchase. It intends to buy 67.972 million shares at a price of $11 per share. The repurchase will be debt financed. After the repurchase, the companys debt-to-equity ratio will be 1 and it will maintain that ratio in perpetuity. What is the WACC with the new capital structure? The cost of debt is 5% and the tax rate is 35%. Express your answer in percentage form.

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