Cooper Inc

69% to 65% and selling and administrative expenses from 22% to 19%, thereby increasing its profitability. Cooper would be able to use Nicholson’s distribution system to cross sell Cooper’s hand tool lines in the industrial and consumer markets.

Cooper anticipated that the Nicholson acquisition would lessen its earnings volatility and currently Nicholson is in the merger market to fend off the raid by H K Porter Company.

Valuation of Nicholson File (without merger)

Please see Exhibit 1 and Exhibit 3 for details and assumptions

Assuming that Nicholson will continue to have sales growth equal to 2 % with cost of goods sold at 69% of the net sales, its market price will stay in the ($19 to $27 range in 1972) and ($22 to $31 in 1976) because of the operating in-efficiencies and lower profit margins (3% to 4 %) as also the un-certain ownership situation. Its share price is therefore lower then its book-value.

Its EPS will range from $2 to $2.25 over the next five years....69% to 65% and selling and administrative expenses from 22% to 19%, thereby increasing its profitability. Cooper would be able to use Nicholson’s distribution system to cross sell Cooper’s hand tool lines in the industrial and consumer markets.

Cooper anticipated that the Nicholson acquisition would lessen its earnings volatility and currently Nicholson is in the merger market to fend off the raid by H K Porter Company.

Valuation of Nicholson File (without merger)

Please see Exhibit 1 and Exhibit 3 for details and assumptions

Assuming that Nicholson will continue to have sales growth equal to 2 % with cost of goods sold at 69% of the net sales, its market price will stay in the ($19 to $27 range in 1972) and ($22 to $31 in 1976) because of the operating in-efficiencies and lower profit margins (3% to 4 %) as also the un-certain ownership situation. Its share price is therefore lower then its book-value.

Its EPS will range from $2 to $2.25 over the next five years....69% to 65% and...