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Blaine Kitchenware: Consider the following repurchase proposal: Blaine will use $209 million of cash and $50 million in new debt borrowed at 6.75% to repurchase
Blaine Kitchenware: Consider the following repurchase proposal: Blaine will use $209 million of cash and $50 million in new debt borrowed at 6.75% to repurchase 14 million shares at a price of $18.50 per share. Evaluate the proposal and its effect on the company's financials statements, EPS,ROE, interest coverage ratio,debt ratio, among other measures. Based on analysis of this proposal anwser the following.Can we quantify the pre- and post-repo cost of financial distress for the firm? why or why not?
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