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DiSanto and the lawsuit pending against MD&F, and (3) the
potential for water rate increases.
Petitioners contend that the appraisals made by Deloitte &
Touche for Mr. DiSanto's estate of $4,803,728 ($25.80 per share)
and by MPI, its expert witness for trial, of $4,375,160 ($23.50
per share) were incorrect. Petitioners contend that Deloitte &
Touche used earnings projections made by MD&F after Mr. DiSanto
died and while Deloitte & Touche prepared the appraisal of Mr.
DiSanto’s estate, which petitioners contend were too optimistic.
Petitioners contend that we should not consider the
redemption price of MD&F stock in 1995 in deciding the value of
MD&F stock on November 26, 1992, or on June 4, 1993, because it
was unforeseeable in 1992 and 1993, and because Fred DiSanto paid
more than fair market value for the stock.
Petitioners point out that respondent's expert critiqued
petitioners' experts' analyses but did not appraise the shares at
issue.
Respondent contends that the fair market value of the
186,177 shares of MD&F stock owned by Mr. DiSanto was $5,585,310
($30 per share) on November 26, 1992. Respondent bases this on
the $26.81 redemption price and MD&F’s payment of $315,000 to
each of the DiSanto children not to compete. Respondent contends
that MD&F's 1997 bankruptcy was unforeseeable on November 26,
1992. Respondent also contends that petitioners' experts used
guideline companies that were dissimilar to MD&F, improperly
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