The simplified balance sheet for the Dutch manufacturer Rensselaer Felt (figures in thousands) is as follows:

Cash and marketable securities		2,300		Short-term debt		76,400
Accounts receivable		120,800		Accounts payable		62,800
Inventory		125,800		Current liabilities		139,200
Current assets		248,900
Property, plant, and equipment		212,800		Long-term debt		209,400
Deferred taxes		45,800
Other assets		88,200		Shareholders' equity		247,100
Total		595,700		Total		595,700

The debt has an interest rate of 4.00% (short term) and 6.00% (long term). The expected rate of return on the company's shares is 13.00%. There are 7.54 million shares outstanding, and the shares are trading at 54. The tax rate is 25%. Assume the company issues 50 million in new equity and uses the proceeds to retire long-term debt. Also assume the company's borrowing rates are unchanged and the short-term debt is permanent. Use the three-step procedure. a. Calculate the cost of equity after the capital restructuring. (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)