- 28 -
Decedent's 18 minority Class A voting shares and 3,942.048 minority
Class B nonvoting shares?". We disagree with this framing of the
ultimate valuation issue before us. The valuation of a single
class of stock in J.R. Simplot Co. is not before us. Rather, we
must determine the value of decedent's interest in two distinct
classes of stock: Class A voting stock and class B nonvoting stock
of J.R. Simplot Co. The class A voting stock represents a
significant percentage (23.55 percent) of the total outstanding
voting stock of the Company. Although decedent's class A voting
stock represents a minority interest, it is sizable nonetheless,
and except for Scott's 29.35-percent interest in the voting stock
of J.R. Simplot Co., there is no other block of voting stock larger
than that of decedent. The class A voting stock should not, in our
opinion, be combined and valued with the class B nonvoting stock.
Petitioner further asserts that the fair market values of the
J.R. Simplot Co. class A voting and class B nonvoting stock are
identical--$2,964.10 per share. According to petitioner, because
decedent's class A voting shares do not represent voting control,
they are effectively equivalent to class B nonvoting shares and are
entitled to no or only a negligible premium for voting. In
petitioner's view, noncontrol voting and nonvoting shares are
"functionally equivalent" because no economic benefits were
available to class A vis-a-vis class B shareholders, and there was
no reasonable expectation that disproportionate economic benefits
would be available to the class A shareholders in the foreseeable
future. Indeed, petitioner's experts opined that the 360-day
Page: Previous 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 NextLast modified: May 25, 2011