In the fourth quarter of the current year, Mega-Knowles Enterprises (Company) announced its plan to acquire 65% of the outstanding 100,000 shares of El Blanco de Espaa (Target) common stock in a business combination. Targets financial statements are reported in accordance with IFRS, while Companys financial statements are reported in accordance with US GAAP. Company will account for the transaction in accordance with ASC 805, Business Combinations.

On the acquisition date, Company paid $40 million in cash and issued 75,000 shares of Company common stock to the selling shareholders of Target. Companys share price was $150 on the announcement date and $175 on the acquisition date.

Targets remaining 25,000 shares of common stock had been purchased for $16,000,000 by a small number of original investors. These shares have never been actively traded. Using other valuation techniques (comparable firms, discounted cash flow analysis, etc.), Company estimated the fair value of Targets non-controlling shares at $25,000,000.

The parties agree that Company would issue to the selling shareholders additional shares contingent upon the achievement of certain performance goals during the first 24 months following the acquisition. The acquisition-date fair value of the contingent stock issue was estimated at $3,000,000.

Target has a research and development (R&D) project underway to develop a cure for neck cancer. Company estimates that the technology has a fair value of $1,500,000. Company considers this R&D as in process because it has not yet reached technological feasibility and additional R&D expenditures are needed to bring the project to completion. Target also has a Customer List that Company estimates has a fair value of $450,000. No assets have been recorded in Targets financial records for the R&D costs or Customer List.

Targets balance sheet assets and liabilities are estimated to be similar to their fair values. Those accounts include the following:

Current Assets	12,500,000
Investments	20,000,000
Property, Plant & Equipment	25,000,000
Intangible Assets	18,500,000
Accounts Payable	3,750,000

Neither the receivables nor the payables involve Company.

WHAT IS THE ACQUISITION-DATE FAIR VALUE OF TARGET?