HT wants to expand its party stores into the Southeast and is considering purchasing Joes Party Supply. HT has debt out with a mkt value of $140m and a YTM of 6%. The company's mkt cap is $380m and the required return on equity is 11%. Joes has debt out of $30.5m. The T1 EBIT for Joes is forecast at $12.5m and is expected to grow at 10% per year for the next five years before slowing to 3 percent in perpetuity. Net working capital, capital spending, and depreciation as a % of EBIT are expected to be 9%, 15%, and 8%, respectively. Joes has 1.85m shares out and a tax rate for both companies is 38%.