Ron Paul Pharmaceuticals is interested in acquiring Old Drugs Ltd. The projected cash flow statement for Old Drugs after the merger is shown below, and these cash flows are estimated to grow at a constant rate of 6 percent per year: Net revenues $305.6 Operating expenses $244.8 Depreciation $16.0 Earnings before interest and taxes (EBIT) $44.8 Interest $12.3 Earnings before taxes $32.5 Taxes $11.4 Net profit $21.1 Estimated retentions $19.2 The current capital structure of Old Drugs is 60 percent debt, which would be maintained after the merger. Old Drugs currently has $570.5 million of outstanding debt with an interest rate of 10 percent. Both Ron Paul and Old Drugs face a 35 percent tax rate. The beta of Old Drugs is predicted to increase to 1.4 after the merger. The risk-free rate of interest is 4 percent, and the market risk premium is 5 percent. The mean market multiple of recent pharmaceutical mergers is 10.265 times the EBITDA. Estimate the equity value of Old Drugs Ltd. using the: a. Free operating cash flow method b. Free cash flow to equityholders method c. Market multiple method