Problem
ALPHA has FCFF of €700 and FCFE of €620. ALPHA's before-tax cost of debt is 6%, and its required rate of return for equity is 10%. The company expects a target capital structure consisting of 30% debt financing and 70% equity financing. The tax rate is 25%, and FCFF is expected to grow forever at 5%. ALPHA has debt outstanding with a market value of €2.200 and has 200 outstanding common shares. What is the enterprise value of ALPHA?