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according to Mr. Egan’s report, it paid more dividends per
earnings than all but one of the comparable companies.
Considering all of the evidence, we conclude that any discount
for general factors within Mr. Egan’s methodology should be
limited to 10 percent.
If Mr. Egan’s analysis is adjusted to provide a “general
factors” discount limited to 10 percent, the indicated value
becomes $94 per share (undiscounted value of $160 per share, less
10 percent for general factors, less a 35-percent discount for
lack of marketability).
Mr. Haywood’s Report
Mr. Haywood used a combination method of an asset-based
value and an earnings-based value to estimate the value of the
FNBW stock. Mr. Haywood was the only one of the experts who used
an asset-based value in his analysis.
Asset-Based Value
In his calculation of asset-based value, Mr. Haywood began
with the book value of stockholder equity and then made
adjustments to this figure to reach market value of stockholder
equity (i.e., net asset value). Book stockholder equity in FNBW,
according to Mr. Haywood, was $11,249,000. Mr. Haywood increased
this by two amounts. First, according to him the market value of
FNBW’s securities portfolio exceeded the portfolio’s book value
by $798,000, so he increased stockholder equity by this amount.
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