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b. Kimball Reports
Mr. Kimball used the net asset value method to compute
controlling equity value of True Ranches. The company’s major
assets included land and improvements, machinery and equipment,
and feed and livestock inventories. Mr. Kimball relied on the
following appraisals to derive the company’s net asset value:
(1) Land and improvements appraisal prepared by H&H as of
January 1, 1993, and June 3, 1994, (2) machinery and equipment
appraisal prepared by Don Helberg as of June 1994, and (3) feed
and livestock inventories appraisal prepared by the
superintendent of True Ranches as of January 1, 1993, and June 4,
1994. With this information, Mr. Kimball adjusted True Ranches’
book value balance sheet to reflect the fair market value of
assets and liabilities and calculated an adjusted net asset value
of $41,003,000 as of January 1, 1993, and $45,297,509 as of
June 4 and June 30, 1994.
Mr. Kimball then applied a 25-percent minority discount,
reflecting the subject interests’ lack of control, to arrive at a
marketable minority value of $30,752,250 as of January 1, 1993,
and $33,973,132 as of June 4 and June 30, 1994.
c. Final Lax Report
The final Lax report also used the net asset value method to
value True Ranches’ total equity, generally relying on the same
asset appraisals used in preparing the Kimball reports. However,
Mr. Lax adjusted True Ranches’ balance sheet information as of
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