Fair value in squeeze-out of large mining companies
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Date
2021-12-31
ORCID
Advisor
Referee
Mark
Journal Title
Journal ISSN
Volume Title
Publisher
Technical University of Kosice
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Abstract
The objective of the paper was to evaluate and propose a method for the valuation of the purchase of minority interest in the squeeze-out of large mining companies in the Czech Republic. The research was conducted on a case of a specific company. An analysis of the relevant industry, potential, and financial analysis were performed. Based on these analyses, the method of DCF Equity (Discounted Cash Flow) was selected as a suitable method that can best capture and consider the specifics of the company assessed since, within this method, cash flows are discounted to the owners. The resulting fair value of the transaction reflects the stock market value to determine adequate cash settlement in squeeze-out. It sufficiently compensates the damage caused to the minority shareholder while accepting the price by the majority shareholder, who is willing to pay up to the amount corresponding to the benefits the transaction brings to them. In accordance with the IVS, the selected method is suitable for squeeze-out transactions, where legislators have the information on the values of the majority shareholder´s benefit and knows the value the minority shareholder is willing to accept in squeeze-out.
Description
Citation
Acta Montanistica Slovaca. 2021, vol. 26, issue 4, p. 712-731.
https://actamont.tuke.sk/pdf/2021/n4/10bartos.pdf
https://actamont.tuke.sk/pdf/2021/n4/10bartos.pdf
Document type
Peer-reviewed
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Published version
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Language of document
en