ABC Ventures is a private equity investor considering investing $100 million in the equity of XYZ Ltd. ABC Ventures requires a return of 25% on investment with planned holding period of 7 years. The likely debt of XYZ Ltd. will be $100 million and cash balance of $20 million with a projected EBITDA of $175 million for the year 7. The desired ownership share of ABC Ventures in XYZ Ltd., given FVF0.25,7= 3.248, will be:
1
34.77%
2
25.00%
3
35.23%
4
6.77%