What is the enterprise value of the private firm

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Reference no: EM132020109

Problem

You are supposed to calculate the equity value of a private firm. Here is the financial statements of the private firm ( in thousands) :

	2016
Current Assets
Cash and equivalents	$20,000
Receivables	40,000
Inventories	29,000
Other current assets	23,000
Total current assets	$112,000

Noncurrent Assets
Property, plant, and equipment	$145,000
Less: Accumulated depreciation	43,000
Net property, plant, and equipment	102,000
Investments	70,000
Other noncurrent assets	36,000
Total noncurrent assets	208,000
Total assets	$320,000

Current Liabilities
Accounts payable	$41,000
Short-term debt	12,000
Other current liabilities	17,000
Total current liabilities	$70,000
Noncurrent Liabilities
Long-term debt	100,000
Total noncurrent liabilities	100,000
Total liabilities	170,000

Shoreholders' Equity
Common equity	40,000
Retained earnings	110,000
Total equity	150,000
Total iabilities and equity	$320,000

	2016
Sales	$250,000
Cost of goods sold	125,000
Gross operating profit	125,000
Selling, general, and administrative expenses	50,000
EBITDA	75,000
Depreciation and amorization	10,500
EBIT	64,500
Interest expense	11,000
Pretax income	53,500
Income taxes	16,050
Net income	$37,450
Shares outstanding	13,000
EPS	2.88

You also find the following four competitors and their enterprise value and EBITD:

($ millions)	APU	PRAX	AIT	ARG
Enterprise Value	31,140	47,400	2,010	10,454
EBITDA	2,481	3,703	197	943

A) What is the enterprise value of the private firm based on the EBITDA multiple valuation?

B) What is the equity value? What is the equity value per share?

Reference no: EM132020109

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