bOrca Industries is considering the purchase of Shark Manufacturing. Shark is currently a supplier for Orca and the acquisition would allow Orca to better control its material supply. The current cash flow from assets for Shark is $$7\mathrm{.}4$ million. The cash flows are expected to grow at $9$ percent for the next five years before leveling off to $6$ percent for the indefinite future. The costs of capital for Orca and Shark are $13$ percent and $11$ percent, respectively. Shark currently has $3$ million shares of stock outstanding and $$25$ million in debt outstanding. Problem $13-20$ Firm Valuation

Orca Industries is considering the purchase of Shark Manufacturing. Shark is currently a

supplier for Orca and the acquisition would allow Orca to better control its material

supply. The current cash flow from assets for Shark is $$7\mathrm{.}4$ million. The cash flows are

expected to grow at $9$ percent for the next five years before leveling off to $6$ percent for

the indefinite future. The costs of capital for Orca and Shark are $13$ percent and $11$

percent, respectively. Shark currently has $3$ million shares of stock outstanding and $$25$

million in debt outstanding.

What is the maximum price per share Orca should pay for Shark? $($Do not round

intermediate calculations and round your answer to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

what is the maximum price per share Orca should pay for Shark? $($Do not round intermediate calculations and round your answer to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$