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further negotiation at that time was useless, and the
negotiations ceased. The negotiations resumed late in 1989.
Nissho Iwai, without JAL, approached the DHL shareholders in
October 1989 to see if they would sell control of DHLI/MNV for a
purchase price based upon a total value for the entities of $670
million. The DHL shareholders reacted favorably. JAL objected
to Nissho Iwai’s actions. Also in October 1989, Peers suggested
to JAL that it purchase a 25-percent interest in DHLI/MNV. Peers
advised that if JAL wanted a controlling interest, it would have
to increase the purchase price to $650 million for DHLI/MNV and
the DHL trademark with a 1-percent royalty.
On October 19-20, 1989, Hillblom and Mitsuo Ando (a JAL
principal) reached an understanding, which they recommended to
their colleagues, under which JAL would purchase 50 percent of
DHLI/MNV, Nissho Iwai would purchase 10 percent, and the DHL
shareholders would retain 40 percent, based on a $450 million
value of DHLI/MNV to determine the purchase price. JAL then
advised that it would agree to the above terms only if it
received control of the boards, and Hillblom rejected that offer.
JAL then suggested buying, with Nissho Iwai, a 39-percent
interest in DHLI/MNV.
Hillblom believed that for control (51 percent or more) of
DHLI/MNV, the purchase price had to be based on a valuation of
$600 million or more; for less than control, the purchase price
could be based on a valuation of $500 million. Allen strongly
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