They paid how much for the producing property?

Authors Heather and Wiggins argue (OGJ, Oct. 29, 2001, p. 42) that discount rates are lower and valuations higher for larger (and in their argument, better) producing properties. They attribute this lowered discount (reduced risk) rate to improved technology and/or the buyer's lower operating cost. They contend a well-conceived purchase enhances the synergy between the buyer and the properties bought that might not be evident for 5 or more years.But there is an uglier reason some properties have been purchased at a much lower discount rate. Some large independent companies, who fear being bought out, are willing to pay more for a property in order to stave off being gobbled up themsel...

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