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percentage to reflect the size of the block of stock to be
valued.
For the 10 years subsequent to the valuation date,
petitioner's first expert projected for Wilber Corp a low
dividend yield, low asset growth, low net income growth, low
return on average assets, and low return on average equity.
At trial, petitioner's second expert focused on the
significant size of the block of stock to be valued, the limited
type and number of investors that would be capable of purchasing
the large block of stock (namely, banks and other financial
institutions), and the regulatory restrictions that he believed
would discourage such investors from purchasing the block of
stock.
Petitioner's second expert opined that the October sales
price of approximately $50 per share on the over-the-counter
market did not accurately indicate the price that investors would
pay for the shares of decedent's stock if all 201,408 shares
became available at the same time. Petitioner's second expert
concluded that the market could only absorb a sale of 15,000 to
20,000 shares of stock in Wilber Corp at the October sales price
of approximately $50 per share, and that, within a reasonable
period of time, the increased supply of shares would flood the
market and cause the market price of the shares to decrease to
perhaps as low as $34 per share.
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Last modified: May 25, 2011