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c. Respondent’s Expert
Respondent offered Mukesh Bajaj, Ph.D. (Dr. Bajaj), as an
expert witness to testify concerning the valuation of closely
held entities. Dr. Bajaj is the managing director of the finance
and damages practice of LEC, LLC. He also has experience as a
university professor of finance and business economics. Dr.
Bajaj has lectured extensively on valuation issues, and he has
testified as an expert in several valuation cases. The Court
accepted Dr. Bajaj as an expert in the valuation of closely held
entities and received his written reports into evidence as his
direct and rebuttal testimony, respectively.
In his direct testimony, Dr. Bajaj concludes that, based on
an 8.34-percent minority interest discount and a 7-percent
marketability discount, the fair market value of a 1-percent
assignee interest in MIL on the valuation date was $150,665.64.
Based on that figure, Dr. Bajaj further concludes that the fair
market value of each petitioner’s one-half share of the gifted
interest on the valuation date was $6,202,429.67.
B. Value of Underlying Assets
The parties agree that, on the valuation date, MIL’s net
asset value (NAV) was $17,673,760, broken down by asset class as
follows:
Asset Type Value
Equities portfolio $3,641,956
Bond portfolio 8,040,220
Real estate partnerships 5,194,933
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