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A company has an EBIT of $3,140 in perpetuity.The unlevered cost of capital is 13.10%, and there are 16,870 common shares outstanding.The company is considering

A company has an EBIT of $3,140 in perpetuity.The unlevered cost of capital is 13.10%, and there are 16,870 common shares outstanding.The company is considering issuing $6,910 in new bonds at par to add financial leverage.The proceeds of the debt issue will be used to repurchase equity.The YTM of the new debt is 8.30% and the tax rate is 21%.What is the value of the firm after the restructuring?

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