You are the top management of a newly formed special purpose company spc$.$

The purpose of the company is to invest in infrastructure sector by acquiring several companies in different industries. You can acquire as many companies as possible as long as your equity, borrowing capacity and cash flow projections permit.

Your company has no debt as of today as it is a newly formed and the balance sheet is rather simple.

Assets : usd $100\mathrm{.}000\mathrm{.}000$ cash

Liabilities : usd $100\mathrm{.}000\mathrm{.}000$ paid in capital

As you proceed further with the acquisitions, your b$/$s will grow on both liability and asset sides. The share holders$$ yield expectation on the equity is not less than $25\%.$

The working capital loans can be utilized only once within $20$ years only to cover the cash flow mismatch and should be repaid in the coming year in full $($principle and the interest$).$ Mt or lt facilities cannot be used for mismatching cash flows. All the lt and mt loans for the acquisition will be utilized upfront, and all the equity will be injected on day $1$ for the acquisition. Mt or lt loans can be utilized after the first day only for the capital investment. The e$/$d ratio will not be less than $35/65$ for any lt$/$mt loan utilized $($for both mt$<$ loans utilized for acquisition and capital investment$).$ The equity required to cover the cash deficit can be injected in the due course.

Please note the terminal value of the assets will be assumed to be $50\%$ of the bid amount unless otherwise stated. Please also note the cash generations are free of operational and other costs and no corporate tax. The funding composition of the bids will be used to calculate the wacc, the equity and the loans used in the due course will not be taken into consideration for wacc calculations to simplify the process.

Bank loans:

Bank $1($ecgd$)$

Usd $30\mathrm{.}000\mathrm{.}000$ dtd $20$ years, grace period $15$ years then amortizing, interest rate fixed $3\%$ pa

Bank $2$

Usd $70\mathrm{.}000\mathrm{.}000$ dtd $20$ years, $10$ year grace, interest rate fixed $6\%$

$($please note bank $10$ is a development bank and its facilities are only available for energy and environment projects$)$

Target companies

$($all the acqusition payments for all the projects will be done upfront on day $1)$

Target company $1$: a licence holder is selling the wind power plant licence. The licence is for $90$ mw and the capacity utilization factor is $35\%.$ The construction period is anticipated not to be longer than $9$ months. The cost breakdown is as follows:

Generators and turbines options,you can choose any brand:

usd $50\mathrm{.}000\mathrm{.}000($uk made$)$

eur $45\mathrm{.}000\mathrm{.}000($german made$)$

usd $40\mathrm{.}000\mathrm{.}000($korean made$)$

Local expenses tl $70\mathrm{.}000\mathrm{.}000($regardless the origin of the generators &turbines, local expenses will be incurred$).$

A renovation will be required in the $10$th year to improve the efficiency of the grid connection. The investment is estimated to be not less than $30$ mil usd.

The licence holder wants the licence fee upfront.

Target company $2$: a small municipality has announced the tender for the water conveyance, water distribution and wastewater treatment network to be privatized on bot$-$build operate and transfer basis for $20$ years $($which means the assets will be transferred back to the municipality free of charge$).$ The system is operating in a very inefficient fashion. Immediately after the transfer of the operating rights, the cash generation will start. The revamping and additional construction is projected to take $12$ months and the cost breakdown is as follows.

Pump options $$you can choose any of the following:

$$ uk made usd $40$ million

$$ german made eur $35$ million

$$ local made tl $60$ million

$$ construction$/$local cost tl $80$ million$($regardless the origin of the pumps, local expenses will be incurred$)$

Following the investments, the revenue will surge. The net cash revenue in the first year will be usd $12\mathrm{.}000\mathrm{.}000$ and after the modernization the revenue is expected to increase by $10\%$ every year. Two major maintenance of the system will be needed in the $10$th and $15$thth year to improve the wastewater treatment system and is expected to cost around $20$ mil and $15$ mil usd respectively

The payment to the municipality will be paid up front.

Data sheet:

The tl$/$usd on day one is $32\mathrm{.}50$ and the eur$/$usd is $1\mathrm{.}05$

Years ; electricity price$($usdc$/$kwh$)$ ; libor; euribor; eur$/$usd; usd$/$tl

$1$;$7,10$;$5,40$;$4,00$;$1,05$;$33\mathrm{.}30$

$2$;$7,60$;$5,50$;$4,30$;$1,06$;$36\mathrm{.}10$

$3$;$6,70$;$5,60$;$4,40$;$1,07$;$38\mathrm{.}55$

$4$;$7,40$;$5,00$;$4,20$;$1,08$;$42\mathrm{.}85$

$5$;$7\mathrm{.}50$;$5,10$;$4,50$;$1,09$;$44\mathrm{.}20$

$6$;$7,00$;$5,20$;$4,20$;$1,10$;$45\mathrm{.}90$

$7$;$6,90$;$5,4$;$4,60$;$1,15$;$46\mathrm{.}00$

$8$;$6,60$;$5,70$ ;$4,60$;$1,20$; $46\mathrm{.}20$

$9$;$6,80$;$5,40$;$4,20$;$1,25$; $47\mathrm{.}30$

$10$;$6,90$;$5,50$;$4,40$;$1,29$;$48\mathrm{.}75$

$11$;$6,10$;$5,15$;$4,60$;$1,19$;$49,26$

$12$;$6,40$;$5,20$;$5,10$;$1,15$;$52,25$

$13$;$8,10$;$5,80$;$4,00$;$1,07$;$53,30$

$14$;$8,20$;$4,40$;$3,80$;$1,04$;$53,50$

$15$;$8,90$;$4,50$;$3,60$;$1,03$;$54,0$

Regarding this question, what should be our equity$/$debt ratio for every project? Use Bank $1$ Loan for the first project, and Bank $2$ for the second project. Find NPV$\text{'}$s$.$