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NAKODIA Inc. is considering the acquisition of KOLA Enterprises. You have been assigned to value KOLA. You have made the following projections for KOLA for

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NAKODIA Inc. is considering the acquisition of KOLA Enterprises. You have been assigned to value KOLA. You have made the following projections for KOLA for years 1-5 ($ millions): Year1 Year2 Year3 Year4 Year5 EBIT 20 22 25 26 30 Depreciation 5 5 6 7 8 Capital Expenditures 10 10 15 15 15 4 Investment in Working Capital 3 4 3 4 Assume a tax rate of 34%, a WACC of 13%, 2 million shares outstanding, $30 million debt value, and a growth rate of 5% after year 5. Using the Discounted Cash Flow methodology, with the perpetual growth model for calculating the terminal value, the per share intrinsic value of KOLA's stock is closest to [Note: Ignore cash for this problem.] $19.9 A. $34.5 B. c. OC. $26.15 $62.4 D

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