Using the Chop – Shop approach (or Break-up Value Approach), assign a value for Cranberry Ltd whose stock is current trading at a total Market Price of € 4 million. For Cranberry Ltd, the accounting data set forth three business segments: Consumer Wholesale Retail and General Centers, Data for The Firm’s three segments are as follows –
Assignment 7
Business Valuation – Break Up Value Approach
Using the Chop – Shop approach (or Break-up Value Approach), assign a value for Cranberry Ltd whose stock is current trading at a total Market Price of € 4 million. For Cranberry Ltd, the accounting data set forth three business segments: Consumer Wholesale Retail and General Centers, Data for The Firm’s three segments are as follows –
|
Business Segment |
Segment Sales |
Segment Assets |
Segment Operating Income |
|
Wholesale Retail General |
€ 2,25,000 € 7,20,000 € 25,00,000 |
€ 6,00,000 € 5,00,000 € 40,00,000 |
€ 75,000 € 1,50,000 € 7,00,000 |
Industry data for “Pure – Play” Firms have been compiled and are summarized as follows-
|
Business Segment |
Capitalization / Sales |
Capitalization / Assets |
Capitalization / Operating Income |
|
Wholesale Retail General |
1.85 .20 1.80 |
0.30 0.70 0.45 |
7.00 3.00 2.00 |
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