Managment Engineer - Investment banking

Full exam

2.Labo has €200m oustanding bank loans, bearing 5% annual interests, and €30m cash and equivalents. The day after, the majority shareholder, a Belgian PE fund, injects in the company €30m in the form of capital increase, in view of the foreseen next 3 years strategic development plan approved by the Board of Directors. What is Labo net financial position?Respuesta necesaria. Opción única. (0/4 puntos) €230m €200m €140m €170m Respuestas correctas: €140m 3.The following information is provided regarding the P&L of company Alpha: sales €300m, EBITDA €70m, EBIT €40m, financial interests €10m. Alpha has a D/E ratio of 0.5 and beta levered 1.1, while its average cost of debt is 10% and tax rate 25%. Moreover, you know that Gvt bonds provide an average yield of 3.5% and that the market risk premium is 5.5%. What is the WACC of Alpha? Respuesta necesaria. Opción única. (0/3 puntos) 9.550% 8.525% 8.183% 8.867% Respuestas correctas: 8.867% 4.Alpha is looking for a multiple that can express at best the value of TEL. TEL operates in an industry characterized by heavy investment plans, but negative net earnings. Indicates the most appropriate multiple to adopt among the following ones:Respuesta necesaria. Opción única. (4/4 puntos) P / E EV / Sales EV / FCFF EV / E Respuestas correctas: EV / FCFF 5.Calculate the value of Free Cash Flows to Firm of company Alpha (sales €300m, EBITDA €70m, EBIT €40m, financial interests €10m, net income €20m), knowing that the net working capital increases by €15m YoY, considering only maintenance capex, and €10m YoY increase in bank loans.Respuesta necesaria. Opción única. (4/4 puntos) not enough data €11.7m €25.0m €41.7m Respuestas correctas: €11.7m 6.The asset based method – complex Respuesta necesaria. Opción única. (0/3 puntos) considers profitability includes the valuation of tangible asset shows high complexity includes the valuation of off-balance sheet intangible assets Respuesta correcta: includes the valuation of tangible asset