Find smu value of equity at the end

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Assume capital markets are perfect.

SMU Corp is currently an all-equity company with 58 million shares outstanding, which are currently trading at $30 per share. Additionally, SMU Corp has $224 million in cash. SMU recently announced that it will change its capital structure by issuing $330 million in debt. The $345 million raised by this issue, plus all its $224 million in cash will be used to repurchase existing shares of stock.

Find SMU's value of equity (market cap) at the end of this transaction.

Reference no: EM132826188

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