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You may attempt this question 3 more times for credit. Santos Unlimited ( SU ) was originally unlevered with 4 2 0 0 shares outstanding.
You may attempt this question more times for credit.
Santos Unlimited SU was originally unlevered with shares outstanding. However, after a major financial restructure, SU now has $ of debt, with an annual interest expense of percent. The restructuring has reduced the number of shares to A group of shareholders of SU are not convinced that this move towards adopting financial leverage is a good idea. Their main argument is that there is now some range of EBIT, however low, that will make the shareholders worse off than before. Help understand the situation better by computing the level of earnings before interest and tax EBIT that would make shareholders indifferent between being unlevered ie not having any debt and levered ie having debt Assume a percent corporate tax rate.
Answer: $
Place your answer to the nearest dollar without a dollar sign or a comma if applicable
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