Input data

$ amount of
capital needed
EBIT range
Interest rate
Tax rate
Stock price
Dividend rate
# shares
outstanding

Number
1,200,000,000
$6-9 billion
5%
29%
44.41 (6-4-12 closing price)
0.40
1,900,000,000
Addititional shares
27,020,941
13,510,471

shares to be sold to 100% stock finance

shares to be sold to 50% stock finance

$ EBIT
$ Interest
$ EBT
$ Taxes
$ EAT
$ Dividends
$ EATD
# shares
$EPS

100% Debt
6,000,000,000
60,000,000
5,940,000,000
1,722,600,000
4,217,400,000
760,000,000
3,457,400,000
1,900,000,000
1.82

BEST OPTION IS 100% DEBT FINANCING

9,000,000,000
60,000,000
8,940,000,000
2,592,600,000
6,347,400,000
760,000,000
5,587,400,000
1,900,000,000
2.94

100% Stock
6,000,000,000
6,000,000,000
1,740,000,000
4,260,000,000
770,808,376
3,489,191,624
1,927,020,941
1.81

Total shares
1,927,020,941
1,913,510,471

100% Stock
9,000,000,000
9,000,000,000
2,610,000,000
6,390,000,000
770,808,376
5,619,191,624
1,927,020,941
2.92

50/50 Debt/Stock Combo

6,000,000,000 9,000,000,000
30,000,000
30,000,000
5,970,000,000 8,970,000,000
1,731,300,000 2,601,300,000
4,238,700,000 6,368,700,000
765,404,188
765,404,188
3,473,295,812 5,603,295,812
1,913,510,471 1,913,510,471
1.82
2.93