In prior articles, we committed to presenting our updated valuation for GNC (GNC). Our core methodology is similar to our earlier approach in valuing the company based on the individual operating segments, which we believe have significantly different valuation metrics. The valuation of the manufacturing operation, for example, is based on actual transactions for similar operations although all of these have been acquisitions and, therefore, have an inherent control premium incorporated into the price. We've updated our earlier valuation models, which were developed before the refinancing of the company's debt and the proposed Harbin preferred stock transaction (and therefore used our estimates of the financial composition of these events) by incorporating information based on the actual outcomes.
We've also used, as a reference, GNC competitor Vitamin Shoppe (VSI) to inform our valuation perspective. We're aware of the significant disagreement about the relative merits of the companies and different readers will have different views of the economic position of each company which will, in turn, color their valuation reference. We've not developed a specific opinion on Vitamin Shoppe.
