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LEX SERVICE PLC-COST OF CAPITAL

COMPANY BACKGROUND
- Originally operated small parking garages and
petrol station
- 1945: Acquisitions
- 1970s: Diversification with more acquisitions
- Today: two major lines of business automotive
distribution and contract hire.
Cost of Capital Why Lex is concerned
Cost of capital is the required return necessary to make
a capital budgeting project worthwhile
- Import agreement with Volvo ended early
- 100 million cash payment to Lex
- Future growth initiative

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