Question
From:(redacted)
Sent:Thursday, February 28, 2008 12:02 PM
To:Verne, B. Michael
Subject: Section 801.10
Mike
Ourclient, Company A, is acquiring shares of a publicly-traded target, Company B. Theconsideration for the transaction is a fixed ratio of shares of Company Astock. The rules state that where the acquisition price has not beendetermined, the value shall be the market price. The market price is (801.10(c)(ii))the lowest closing quotation within the 45 days prior to the consummation ofthe acquisition.
Theparties plan on closing in early May - 45 days prior to the consummation of thetransaction would put us at mid-March. If we filed in the next couple of days,we obviously wouldn't be able to determine the lowest closing quotation 45 daysprior to consummation. How should we value the acquisition? I read asimilar informal interpretation stating that we should use the fair marketvalue of the shares, as determined by the Board of company A. Is thiscorrect?
Any guidance would behelpful.