Reference no: EM132951481
In the HBR Case Study "Agnico Eagle Mines LTD", there is a question
"Discuss the estimation of the value of the items related to tax loss as well as the impact of the other valuation items shown in case Exhibit 11." However, I cannot figure out what is meant by "tax loss" as this is a strange phrase. The case mentions a "resource deduction" to lower the marginal tax rate but I don't know if that relates to "tax loss".
Below is the information from exhibit 11, but I cannot tell how it relates to "tax loss". I just need to understand what tax loss is so I can answer the rest of the question.
DAN ACKER'S NOTES - SUPPLEMENTARY AEM VALUATION INFORMATION US$000s
Excess Cash and Marketable Securities Value of Non-Operating Assets 21,180
Value of Non operating assets 12,151
Market Value of Debt(1) 168,802
After-Tax Pension Fund Deficit 1,644
Value of Executive Stock Options 24,192
Terminal Value Formula
TVF2008 = NOPLATPA2008 (1+g) / K where, NOPLATPA2008 = Net Operating Profit Less Adjusted Taxes Plus Amortization g = growth rate of NOPLATPA
K = weighted average cost of capital (year 7)
Note:
(1) Market value of debt includes $166,750 of long-term debt and $2,052 of current interest due on senior convertible notes.
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: "Discuss the estimation of the value of the items related to tax loss as well as the impact of the other valuation items shown in case Exhibit 11." However, I c
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