Mar/June 22 Question Convertibles

Hi,

I have recently just done the May/june 22 Sample Paper and I am confused How I am not getting 11% Covertible Loan Note the question is:

The ordinary shares are currently trading at $5.55 per share and have a nominal value of $0.50 per share. An ordinary dividend of $0.85 per share has recently been paid. The directors have indicated that a dividend of $0.90 will be paid on 31 December 20X7. Tanza Co’s dividends and share price have grown steadily at 6% per year for several years and are expected to continue to do so.

Each loan note has a nominal value of $100 and is currently trading at $108.51. On 31 December 20X9, the investors holding the convertible loan notes may convert the loan notes into 20 ordinary shares. If they choose not to do so, the loan notes will be redeemed at nominal value on 31 December 20X9.

Tanza Co pays corporation tax at a rate of 15%.

My Answer is:

I got the Convertible right at 132.2 the done the following

0 1 2 3 4 5
-108.51 5.1 5.1 5.1 5.1 137.30 (132.2+5.1)Then IRR Function to get 8.39%???? Where am I going wrong please???