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discount: The lack of a ready market for the Hastings shares,
the comparatively small size of prior transactions relative to
the size of decedent's block of stock, the continued dependence
of Hastings on the branch service agreement with Western, and the
general credibility of the A.G. Edwards' report.
Other factors, however, also indicate to us a marketability
discount considerably less than the 40- and 60-percent discounts
suggested by petitioner's experts. The several transactions of
Hastings stock that did occur in 1993 at $47 per share were not
in any way factored into the calculations of petitioner's
experts, and Hastings was in excellent financial condition as of
the valuation date.
Based on the evidence, we conclude that the appropriate
discount for lack of marketability of decedent's 366,385 shares
of common stock in Hastings is 30 percent.
Applying the 30-percent lack-of-marketability discount to
the $100 million total equity value of Hastings yields a fair
market value of $41.51 per share. We conclude that, as of
September 7, 1993, the value of decedent's 366,385 shares of
common stock in Hastings was $15,208,641 ($41.51 times 366,385
equals $15,208,641).
To reflect the foregoing,
Decision will be entered
under Rule 155.
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Last modified: May 25, 2011