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C. Eighty-Eight Oil
1. Marketable Minority Interest Value
a. Kimball Reports
Mr. Kimball applied the guideline company method to value
the subject interests in Eighty-Eight Oil as of January 1, 1993,
June 4, 1994, and June 30, 1994. First, Mr. Kimball identified
five guideline companies that devoted some or all of their
business to the marketing of crude oil and gas. Mr. Kimball then
analyzed four market multiples: EBIT, EBDIT, Revenues, and
TBVIC. He used data from the latest year and an average of the 5
preceding years to calculate the multiples. Mr. Kimball weighted
the EBDIT and TBVIC multiples at 40 percent each and the rest at
10 percent each.
Mr. Kimball concluded that the fair market value of Eighty-
Eight Oil’s total equity on a marketable minority basis was
$25,174,683 on January, 1, 1993, and $31,069,285 on both June 4
and June 30, 1994.
b. Final Lax Report
The final Lax report also used the guideline company method
and compared Eighty-Eight Oil’s financial results to those of six
companies. As a group, the chosen guideline companies engaged in
all aspects of the oil and gas business, including acquisition of
properties, exploration and production, and transportation and
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