|
|
Net operating income |
€264,000,000 |
Debt coverage service ratio |
2.18X |
Annual debt service |
€264,000,000/2.18 = €121,220,135 |
Cash flows (PMT) for 10 years |
€264,000,000 − €121,220,135 = €142,779,865 |
Cash initial outflow year 0 (PV) |
€2,350,000,000 × 0.40 = €940,000,000 |
Terminal value (FV) in 10 years |
€2,800,000,000 − €909,893,015 = €1,890,106,985 | PMT = €142,779,865; PV = - €940,000,000; FV = €1,890,106,985; N = 10; Solve for I/Y. Internal rate of return is 19.23% |