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Mr. Chaffe determined under the income approach utilizing a
discounted cash flow model that the marketable, minority value of
the Company's stock as of the valuation date was $12,549,597.
The value indications that Mr. Chaffe arrived at for the
marketable, minority value of the common stock of Marrero Land on
the valuation date under the different valuation approaches that
he used were:
Valuation Approach Value Indication
Market approach
Publicly traded
guideline companies $17,100,000
REIT's 18,000,000
REOC's 17,000,000
Income approach using
discounted cash flow model 12,549,597
Based on a review of the various tests of value that he used
and using implicit weighting, Mr. Chaffe determined that the
aggregate "as if traded" value of the common stock in minority
blocks of shares of Marrero Land as of the valuation date was
$18,000,000. That value resulted from a weighting upward from
the respective values that he determined under the market ap-
proach using publicly traded guideline companies and the income
approach utilizing a discounted cash flow model to the market
20(...continued)
500 Index. Adding those three rates indicated an expected return
rate for the smaller-company traded stocks of 20.2 percent (8.2
percent risk free rate plus 8.3 percent S&P 500 Index plus 3.7
percent small-company stock premium). Mr. Chaffe did not add a
specific company risk premium because he used a no-growth model
of future cash flow.
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