VALUATION: state-owned 100% debt, what discount rate to use?

Baginski's picture
Rank: Baboon | banana points 111

I'm valuating a state-owned 100% debt not-for-profit airport that is set for privatization.

I must use DCF,

what discount rate to use?

NOTE: I calculated WACC (which is just the cost of debt since it's 100% debt financed) and it turned out to be only 3.9%. What do?

Investment Banking Interview Course

  • 7,548 questions across 469 investment banks. Crowdsourced from over 500,000 members.
  • Technical, behavioral, networking, case videos, templates. All included.
  • Most comprehensive IB interview course in the world.

Comments (3)

Nov 12, 2017

What concert costs 45 cents? 50 Cent feat. Nickelback.

Nov 12, 2017

The enterprise in my question is subject to privatization. It will not be 100% debt next year.

The purpose of the valuation is to set a selling price for PE

Nov 12, 2017