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was worth $1.375 billion. Using an “avoided costs approach”,
Bradley determined that the management authority might have a
fair market value ranging from $9.2 million to $44.1 million.
Bradley, however, gave no apparent consideration to the
contractual aspects of the Bender transaction and assumed--
contrary to any reasonable expectation or contractual
possibility-–the immediate dissolution of MB Parent, Bender, and
the LLC as of July 31, 1998, the date of the transaction.
Bradley and petitioner’s other experts, in rebuttal to
respondent’s experts, asserted that, if separated from economic
ownership of the common stock of MB Parent, the management
authority had no value to a hypothetical purchaser.
Respondent presented three experts who had separately valued
the management authority and the MB Parent common stock. Alan C.
Shapiro (Shapiro) provided an opinion of the fair market value of
the common stock immediately after the merger. Like Bradley,
Shapiro began with a determination of net asset value. Shapiro,
however, reviewed all of the contractual arrangements and
corporate governing documents and concluded that the MB Parent
common stock should be discounted substantially for lack of
control over the assets. Using various assumptions, such as the
net value of MB Parent’s assets after liabilities and the scope
of fiduciary responsibilities by the manager, Shapiro concluded
that the fair market value of the MB Parent common stock ranged
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