Secure Guaranteed Retirement (SGR) pension fund is the only shareholder of Kerman Manufacturing with 100% ownership that has less cash flow needs in the short-term. SGR is the early intuitional investor in Kerman Manufacturing that bought its shares for $10 each last year. Kerman Manufacturing has 10 million shares outstanding, each share trading at $20. It has a total of $300 million in debt, total assets of $400 million and $100 million is in excess cash. This excess cash can be used to:

1. pay off some of its debt
2. be paid out immediately via share buy back.
3. be paid out immediately as a special dividend.
4. invest the funds in Treasury bonds paying 4% interest forever.
5. invest the funds in a new project generating a $5 million in free cash flow annually, which is growing at 2%, and its cost of capital is 12%.

Assume both the dividend and capital gain tax rates are 20% and the corporate tax rate is 40%. Also, assume the market has no prior about Kerman Manufacturings decision and either of the above five strategies will be a surprise announcement for the shareholders. The goal is to calculate the effect of each of the above strategies on the value of SGR shares, and use the results to rank SGR preferences for options I to V.

By how much in million dollars does the market value of SGR fall/increase as a result of share buyback (option#2)?