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Valuation of the Firm (By Aswath Damodaran, 3rd edtion) Value per Share Chapter 16 2) Genius Media is a high growth technology firm. The value

Valuation of the Firm (By Aswath Damodaran, 3rd edtion)
Value per Share
Chapter 16
2) Genius Media is a high growth technology firm.
The value of its Operating Assets has been estimated at $ 530 million.
Genius Media has a cash balance of $ 80 million.
It also owns 10% of an entertainment software firm.
This 10% holding is recorded at its book value of $ 40 million and
the average price to book ratio of entertainment software firms is 2.5.
Finally, a competitor has sued Genius Media, claiming patent infringement.
There is a 25% probability that Genius Media will lose the lawsuit,
in which case it will have to pay out $ 100 million in damages.
Estimate the value of equity in the firm today.

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