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considered part of a control group. Also, respondent's expert,
in concluding that decedent's 23.8-percent interest should
somehow be treated as part of a hypothetical 51-percent
controlling interest, effectively ignores the requirement present
in Wilber Corp's articles of incorporation of a 66 2/3-percent
super majority for decisions regarding the merger, consolidation,
dissolution, or sale of all or substantially all of the assets of
the bank.
Respondent argues that a control premium is justified,
because decedent's block of stock arguably could control one
member of the Board of Directors and thereby "substantially
influence" corporate action and cause the sale of the bank.
Before a control premium may be applied, however, something more
than "substantial influence" is required. See Estate of Newhouse
v. Commissioner, 94 T.C. 193, 251-252 (1990).
Based on our analysis of petitioner's experts’ opinions
(implicitly reflecting a blockage discount), we use as our
starting point the $38 per-share value calculated by petitioner's
experts. Adjusting upward this figure based on the excellent
financial condition of Wilber Bank, and taking into account the
$50 per-share average sales price of Wilber Corp stock in the
thinly traded over-the-counter market, we conclude that on
October 20, 1990, the value of the 201,408 shares of stock in
Wilber Corp was $9,063,360, or $45 per share.
To reflect the foregoing,
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