Question: , Please answer using excel, and show the formula. all the boxes left empty AND YELLOW IN COLOUR needs to be answered !!! please help
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Please answer using excel, and show the formula. all the boxes left empty AND YELLOW IN COLOUR needs to be answered !!! please help ASAP
SECTION III TRANSACTION ANALYSIS (45 POINTS) Question 3 (25 points) Based on the case below please construct the Transaction Sources & Uses and calculate the WACC Phatchance Hotel Properties, Inc. Jack Von Crook, a hotel investor, is in the process of purchasing Phatchance Hotel Properties, Inc. ("PHP"). PHP operates two hotels in Miami, Florida with total of 800 rooms. He is anticipated to complete the necessary renovations on these properties by December 31, 2019 and open its doors for business on January 1st, 2020. The estimated total cost of both properties is $340 million, plus additional $50 million for renovations. PHP estimated 2019 EBITDA of $50 million and outstanding debt of $40 million. Capital Raising: Jack needs capital to purchase and renovate the two properties as well as refinance its current debt outstanding (assume no transaction fees). Jack will invest $90 million of equiy. He received an approval for the bank loan for 6x 2019 EBITDA and the rest of the financing will be paid in Corporate Bonds. The pricing is as follows: Bank Loan @ 8.0% Fixed Rate, Corporate Bonds @ 10.0% Fixed Rate and the Equity expected return is calculated based on CAPM with risk free rate of 3.0%, beta of 1.7x and equity market return of 14.0% Transaction Uses Amount Please write the whole number (i.e. 200,000,000 for $200 million) 340,000,000 50,000,000 Cost of property Renovation Refinance Debt Transaction Fees & Expenses Total Uses 40,000,000 21.7% 430,000,000 Pleasse write the whole number (i.e. 200,000,000 for $200 million) TAX RATE = 22.0% Amount WACC Transaction Sources % Capital Interest /Expected Return Interest /Expected Return After Tax Bank Loan 240 0.00% 8.00% 10.00% 100 0.00% Corporate Bonds Equity 90 0.00% Total 430
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