GloboChem is an all-equity firm. Analysts expect GloboChem to generate free cash flow of $3M at the end of the current year and they expect those cash flows to grow at 2.5% in perpetuity. GloboChem has 4 million shares outstanding, which trade for $20 per share, and stockholders require a return of 6.25%. The tax rate is 35%. The GloboChem CFO is considering a recapitalization. It will borrow (at kD = 5%) and use the

borrowed funds to repurchase shares. It targets a capital structure with a debt-to-value ratio of 40%. After the recapitalization, the WACC will be 5.55% and the value of the firm will rise to $98.3607 million. If the company offers $24.58 for shares in the repurchase, what will the stock price be after the repurchase?