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from 1990 to 1992, Johnson’s use of a 15-percent growth rate for
American Vanguard was too generous. We believe Johnson should
have used a 5-percent growth rate for American Vanguard since
that is the growth rate he used for Green Light and its earnings
were growing faster than those of the guideline companies.
Johnson’s analysis was more persuasive than Fuller’s.
Fuller did not adequately consider the differences between Green
Light and American Vanguard, the guideline company he considered
to be the most comparable. For example, he gave little weight to
the facts that: Green Light does not manufacture products; its
product lines are far less diverse than those of the guideline
companies; its five largest customers accounted for more than 70
percent of its sales; it sells its products regionally, not
nationally; its primary market in 1993 was limited to the home
and garden market and did not include agribusinesses or golf
courses; and it had minimal insurance coverage for products
liability and environmental claims. He did not adjust the
multiples for American Vanguard for customer concentration,
product mix, geographic diversification, or market segment
factors. We think his failure to do so was improper given the
differences between Green Light and American Vanguard.
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