equity investment fair value turkey john please give another day elaborate quite hectic vince enron capital trade resources corp europe john bottomley 06 21 2000 03 41 vince j kaminski hou ect ect cc subject equity investment fair value turkey vince thoughts end john vince j kaminski 19 06 2000 15 45 john bottomley lon ect ect cc dale surbey lon ect ect vince j kaminski hou ect ect stinson gibner hou ect ect subject equity investment fair value turkey john seems using risk free rate appropriate shall elaborate position send longer message afternoon time vince enron capital trade resources corp europe john bottomley 06 19 2000 05 55 vince j kaminski hou ect ect cc john sherriff lon ect ect dale surbey lon ect ect subject equity investment fair value turkey vince john sherriff recommended contact regarding interesting potentially contentious option valuation issue currently dealing london hold longish term options private company turkey currently seeking ipo issue discussing rac discount rate e risk free turkish us use value options first additional information option characteristics 116 000 options representing 9 company term minimum 3 years possibly longer still renegotiated strike price 20 upcoming ipo price either priced us turkish lire currently hold number options fixed price 118 75 per option 34 800 expire july 15 2000 remainder expiring december 15 2000 company investment bankers abn amro rothchilds concerned regarding strike price values company 118 million believe company worth approx 300 million due large valuation gap originally encouraged us exercise options end june ipo target date late sept early oct counter proposal swap instrinsic value time value repricing options strike higher extending term currently negotiating rac appropriate discount rate use value options arguing us risk free appropriate discount rate current position company historical senior debt cost 18 appropriate number use although admit justifiable proxy key points rac valuing options via crystal ball simulations negotiated discount rate used calculate pv future options intrinsic value 3 years e black scholes higher discount rate yields higher value opposite true using crystal ball simulation model simulates ipo ipo case case ipo put options equity priced fixed 17 return model assigns 30 illiquidity discount simulated cases options money obviously exercise understand black scholes option valuation one needs able construct comparable portfolio cash flows using equity futures risk free order valuation hold reach difficulty since company currently trade public market since equity futures exist turkish equities rac arguing us risk free appropriate use argument non ipo scenario 30 illiquidity discount us based option volatility already factored simulation feel rac approach double counting managed get patient man give call today tomorrow chance digest information regards john bottomley