Question
C) Relying STRICTLY on our classroom discussion: Vista Outdoor (VSTO) is a company with two - roughly equal in terms of sales divisions: Sporting Products
C) Relying STRICTLY on our classroom discussion: Vista Outdoor (VSTO) is a company with two - roughly equal in terms of sales divisions: Sporting Products (mainly ammunition) and Outdoor Products (outdoor lifestyle equipment). The company is currently considering the following business proposal: \ \ VSTO will sell its Sporting Products division for cash (and use the proceeds both to repay debt and to pay a sizable one-time special dividend). After the sale, the company will be renamed Revelyst and will be 100% focused on outdoor products (i.e., outdoor lifestyle equipment). \ \ Imagine the proposed restructuring will go through. \ -What required rate of return would you utilize for Economic Value Added estimation for the company after the restructuring is completed? \ -If current WACC of VSTO, explain why (1-2 sentences).\ - If a different rate, describe how you would estimate such a rate (no numbers necessary, just 1-2 sentence description of what you would do to come up with the appropriate rate).
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