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would have used the dribble-out method to sell its Winn-Dixie
stock over a 5-to-6 month period, he did not discount or adjust
the NYSE price of that stock on the valuation date in order to
arrive at its fair market value and ADDI&C's net asset value on
that date. That is because, inter alia, Winn-Dixie's NYSE price
"was on a rising trend line" from January 3, 1992, through
November 2, 1992, the valuation date, and, in fact, "increased 72
percent during that period."11
To counter Mr. Thomson’s view that no blockage and/or SEC rule
144 discount is warranted because, inter alia, the NYSE price of
Winn-Dixie stock “was on a rising trend line” during the 10-month
period preceding the valuation date, petitioner points out that a
Value Line Investment Survey report (Value Line report) dated
August 21, 1992, which was approximately 3 months before the
valuation date, reported that "[the NYSE price of Winn-Dixie]
stock has risen about 15% in the past few months. As a result,
long-term total return prospects have been diminished". We do not
believe that the opinion expressed in the Value Line report
11 Nor did Mr. Thomson apply a premium to the NYSE price of
ADDI&C Winn-Dixie stock. That is because, even though ADDI&C
owned 1,020,666 shares of the outstanding Winn-Dixie stock, Mr.
Thomson considered that block of stock, which represented only
about 1.33 percent of the total outstanding shares of Winn-Dixie,
to be "too small" to represent a "swing block of shares." It is
noteworthy that petitioner's expert Mr. Pratt acknowledges that
ADDI&C's stock interest in Winn-Dixie on the valuation date "is
generally considered to be a significant investment. An investor
would likely find it difficult to quickly accumulate such a large
investment without some (typically upward) affect [sic] on the
quoted market price on the subject security."
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