Actually, you're right. The appraised value could _theoretically_ be less...I'll have to check with my legal source and see if this has ever actually happened. In this case I wouldn't be worried, because the case law notes that a company which is valued substantially on earnings (as DRNK would be, having few assets) should be valued relative to past 5-year earnings growth, which is tremendous in our case -- and relative to current earnings multiples in the industry, which are, again, very large (checked out KO lately?).
The problem is that some degree of court costs may be subtracted from the payment to the appraisees, and the process takes quite a bit of time, during which your money is tied up and you MAY receive interest at the "prevailing rate" if the court chooses. Therefore, it's not worth it unless the cost can be spread out amongst many people AND the expected difference is very large. Since another quarter of extremely high earnings will go by before this all happens, I'm not worried about there being a disparity...
Still long,
Steve |
