Valuation of the target company is a critical aspect of a merger transaction. Different methods are used in acquisition, valuations such as the corporate valuation method, the adjusted present value approach, the free cash flow to equity approach, and so on. Blanche Inc. is expected to generate a free cash flow (FCF) of $150.00 million this year (FCF1 = $150.00 million), and the FCF is expected to grow at a rate of 22.60% over the following two years (FCF2 and FCF3). After the third year, however, the FCF is expected to grow at a constant rate of 3.18% per year, which will last forever (FCF2). Blanche Inc.'s weighted average cost of capital (WACC) is 9.54%. Use corporate valuation method to complete your analysis. You would discount the FCFs using the The horizon value of Blanche Inc.'s cash flows is The current total firm value of Blanche Inc. operations is in your valuation. (Note: Round your intermediate calculations to two decimal places.) (Note: Do not round your intermediate calculations.) If Blanche Inc. carries $2,433 million of debt before the merger, and the firm has no nonoperating assets or preferred stock, the value of equity of Blanche Inc. to Ziffy Corp. will be $2,433.58 million. $136.58 million. $1,686.43 million. $811.58 million