- 23 -
stock. He determined that these 39 transactions occurred at
prices reflecting discounts of 5.2 percent to 57.6 percent from
the public-market price, with the median discount being 29.3
percent.
Thirteen of the 39 companies in Mr. Oliver’s guideline group
appear to be high-technology companies and also to have some of
the highest discounts, ostensibly reflecting greater risk.22 We
are unpersuaded that these 13 companies are comparable to the
partnership. If these 13 companies are removed from Mr. Oliver’s
guideline group, the median discount of the remaining 26
companies is 19.45 percent.
b. Respondent’s Expert
Dr. Shapiro again relied primarily on the Bajaj study, which
analyzed discounts observed in private placements of registered
shares as well as private placements of unregistered (restricted)
shares. The Bajaj study concluded that the portion of private
placement discounts attributable solely to impaired marketability
was 7.2 percent.
22 These 13 companies and their indicated discounts are:
Electro Nucleonics (24.8 percent); Bioplasty, Inc. (31.1
percent); Sym-Tek Systems, Inc. (31.6 percent); Anaren Microwave,
Inc. (34.2 percent); North Hills Electronics, Inc. (36.6
percent); Newport Pharmaceuticals, Intl., Inc. (37.8 percent);
Quadrex Corp. (39.4 percent); Del Electronics (41 percent); Ion
Laser Technology, Inc. (41.1 percent); Chantal Pharmaceutical
Corp. (44.8 percent); Western Digital Corp. (47.3 percent);
Photographic Sciences Corp. (49.5 percent); and AW Computer
Systems, Inc. (57.3 percent).
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