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Advanced Cherical Industries in waiting the verdict from a court case over whether it is liable for the clean-up of wastes on a disused factory is able this will result in a reduction of free cash flow by 510 mon per year for ten years. It not at there we to ne o On the one of trading the day before the nnouncement of the verdict Advanced Chemicals was trading at 520 por share. Most investors calculate that there is a 100% chance that Advanced Chemicals will have a verdicted against them. One investor Jo has performed oversearch into the outcome of the trial and estimate that there is no chance Advanced Chemicals will have a verde turned again them. Given that Advanced Chemicals 60 milion shares outstanding and an equity cost of capital of 6% with no dubt Jo's estimate of the value of a share of Advanced Chemicals vrould be how much more than the market price OA 20:40 1513 C520.98 D520 61