Kwetu Mikindanyi plc wishes to calculate its weighted average capital cost. The following information relates to the company at the current time.

number of ordinary shares $20$ million

book value at $7\%$ convertible debt TZS $29$ million

book value at $8\%$ bank loan TZS $2$ million

the market price of the ordinary share TZS $5\mathrm{.}5$ per share

market value of convertible debt TZS $107\mathrm{.}11$ per share

equity beta of Kwetu Mikindanyi plc $1\mathrm{.}2$

risk$-$free rate of return $4\mathrm{.}7\%$

equity risk premium $6\mathrm{.}5\%$

rate of taxation $30\%$

Kwetu Mikindanyi PLC expects its share price to rise at an average of $6\%$ per year in the future. The convertible debt can be redeemed at nominal value in eight years or converted in six years into $15$ shares of Kwetu Mikindanyi Plc per TZS $100$ bond.

Required

Calculate the market value$-$weighted average cost of capital of Kwetu Mikindanyi Plc$.$ State any assumptions that you make.