c. The median EBITDA trailing multiple at the end of 1991 from six North American and UK publicly traded packaging companies was 7.9×, and the median EBITDA multiple from six international acquisitions of packaging companies during 1990–1991 was 7.3×.

In addition, Pet¨ofi’s cost of capital needs to account for its micro-cap nature and include a premium for lack of marketability. For such a small company, this premium is hard to gauge. At that time micro-cap U.S. firms had premia of about 4.5%. Finally, even after allowing for its micro-cap nature, one needs to allow for the fact that Pet ¨ofi was still private and further reduce its value below that of a publicly traded micro-cap stock. Empirical evidence compiled in the United States over a number of years suggests a private equity discount on enterprise value of about 20%, and recent research on other developed and emerging markets indicates the existence of significant discounts for lack of marketability.36