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Estimate the market value of the cleaners division

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Free cash flow to The Brillo Brushes Company in the current year for the entire firm is $7.4 million and for the Cleaners division is $3.1 million. The total firm and the Cleaners division are each expected to grow at the same 8% rate into the foreseeable future. Also assume a WACC of 10% for the firm and 9% for the Cleansers division.

Problem 1: Continuing with the Brillo Brushes Company, now estimate the market value of the Cleaners division. Choose the best answer from the choices below.

[A] $310 million

[B] $334.8 million

[C] $155 million

[D] $167.4 million

Reference no: EM132653323

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