EX-99.C7 7 h35300a1exv99wc7.htm VALUATION REPORT OF ATON CAPITAL LIMITED exv99wc7
 

Exhibit (c)(7)
Project Chicago Valuation Summary March 13, 2006


 

Disclaimer Under no circumstances is this document to be used or considered as an offer to sell, or a solicitation of any offer to buy any security. Aton does not make any warranties with regard to the results to be obtained from its use and shall have no liability for any claims, losses or damages arising from or occasioned by any inaccuracy, error, delay, or omission, or from use of this document or actions taken in reliance on the information contained in the document. This document or any portion hereof is confidential and may not be reprinted, sold or redistributed without the prior written consent of Aton.


 

Valuation Methods Discounted cash flow analysis - key method Precedent transactions multiples - secondary method Comparable trading multiples - additional check


 

Approach 1. Value 100% of KKM Field 2. Estimate 100% of Chicago Equity Value 3. Assess minority stake in Chicago X 60% = X 37% =


 

Discounted Cash Flow Analysis


 

Precedent Transaction Multiples


 

Chicago Share Price Dynamics Chicago Share Price Dynamics


 

Results DCF analysis produced base case valuation of $4.15 per share that is at about 28% discount to the current share price of $5.3. Transaction multiples method based on two most relevant deals gives an implied price of $6.91 per share Analysis of recent share price of Chicago leads to a wide price range of $5-$7 per share where trading volume soars with very strong selling supported by record turnover at $7 per share Knowing that the total minority stake in Chicago is not more than 37% (about 15.3 million shares) and assuming potential bid price corridor of $5-$7 per share the total size of the deal will be in a range of $76-$107 million In order to come up with a single starting bid price we suggest to use an average of our DCF ($4.15 per share) and Multiple ($6.91 per share) valuations. The result would be an offer price of $5.53 per share that lies in a lower quartile within projected price range and is 7% premium to 30 days average share price. Total deal size in this case is $84.6 million. Premium (discount) to average price average price average price average price