The client also needs an estimate of Weighted Average Cost of Capital (WACC) for a potential investment in an overseas telecommunications company, Tiacom Plc. In addition the client wants your opinion as to whether the same WACC can be used in each year of a multi-year valuation model. Tiacom Plc has 500 million ordinary shares in issue which are trading at 0.5 per share. A dividend of 5 pence per share has just been paid and historically dividends have grown by 4 percent per year. The company also has listed debt instruments with a market value of 125m and a coupon of 5 per cent. The company qualifies for a corporation tax rate of 25 per cent. Required:

- Calculate the WACC for Tiacom Plc based on the information provided