You have been asked to analyze GenCorp, a corporation with food and tobacco subsidiaries. The tobacco subsidiary is estimated to be worth $ 15 billion and the food subsidiary is estimated to have a value of $ 10 billion. The firm has a debt to equity ratio of 1.00. You are provided with the following information on comparable firms: Business Average Beta and Average D/E Ratio for Food 0.92 , 25% respectively and for Tobacco 1.17, 50% All firms are assumed to have a tax rate of 40%. If the current long-term bond rate is 6%, estimate the current cost of equity of GenCorp.