Raymond Supply, a national hardware chain, is considering purchasing a smaller chain, Strauss & Glazer Parts (SGP). Raymond's analysts project that the merger will result in the following incremental free cash flows, tax shields, and horizon values: Year 1 2 3 4 Free cash flow $20.00 $25.00 $30.00 $35.00 Unlevered horizon value $366.00 Tax shield $2.10 $2.20 $2.30 $2.40 Horizon value of tax shield $25.00 Assume that all cash flows occur at the end of the year. SGP is currently financed with 25% debt at a rate of 10%. The acquisition would be made immediately, and if it is undertaken, SGP would retain its current debt and issue enough new debt to continue at the 25% target level. The interest rate would remain the same. SGP's pre-merger beta is 2.0, and its post-merger tax rate would be 25%. The risk-free rate is 8% and the market risk premium is 4%. Using the compressed adjusted present value approach, what is the value of SGP to Raymond? (Show your answer in millions of dollars.) a. $256 b. $210 C. $282 d. $310 e. $233