Estate of Helen A. Deputy, Deceased, William J. Deputy, Co-Executor - Page 14

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          fact specific and are relied on by litigants and courts for                 
          generalized guidance, but they do not establish bright-line rules           
          for valuation; i.e., they do not establish specific percentage              
          discounts to be applied under particular factual circumstances.             
               The estate’s expert, Mr. Dorman, mentioned three different             
          approaches in valuing the common stock of Godfrey, to wit:                  
          “Market Comparison Approach”, “Adjusted Net Book Value Approach”,           
          and “Capitalized Earnings Approach”.7  Although his report                  
          contains some discussion of all three methods, ultimately, he               
          relied solely on the net asset approach.                                    
               Mr. Dorman rejected the market approach because he could not           
          find what he believed to be comparable companies.  Of six                   
          comparable companies, he noted that four, unlike Godfrey,                   
          reported losses.8  The remaining two were rejected because he               
          “determined that using only the remaining two public companies,             
          Brunswick Corp. and Fountain Powerboat Ind., Inc., would not                
          provide reliable comparable data to arrive at a market measure of           
          value.”  Mr. Dorman, even though he labeled the six companies               


               7 For convenience, we use “market approach”, “net asset                
          approach”, and “income approach” instead of “Market Comparison              
          Approach”, “Adjusted Net Book Value Approach”, and “Capitalized             
          Earnings Approach”, respectively.                                           
               8 We find Mr. Dorman’s reason for abandoning the comparable            
          or market approach to be somewhat curious because, in spite of              
          the “comparable companies” losses, respondent’s expert’s                    
          calculations with similar comparables resulted in the potential             
          for values that were two to three times the value reached by use            
          of the approach advanced by Mr. Dorman.                                     




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