JOHN M. CASE COMPANY Mergers and Acquisitions OCTOBER 6, 2015 FINA 5513D - MERGERS AND ACQUISITIONS Syed Ali Ahmad (100978220), Long Thanh Dinh (100986227) Zeeshan Halim (100986227) Table of Contents Executive Summary .................................................................................................................. 2 Why the J.M.C. Company is an Attractive Target for the Firm’s Management ............... 3 Why purchase the J. M. C. Company by LBO ....................
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A. 1. Right to share income and assets 2. Control of the firm 3. Preemptive right 4. Voting Right B. Free cash flow (FCF) represents the cash that a company is able to generate after laying out the money required to maintain or expand its asset base. Free cash flow is important because it allows a company to pursue opportunities that enhance shareholder value. Without cash, it's tough to develop new products, make acquisitions, pay dividends and reduce debt. All else equal, the WACC of a firm
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Tendo presente o princípio que define que o valor de uma obrigação corresponde ao valor do portfolio de cupões-zero que replica os seus cash-flows, para procedermos à avaliação da obrigação emitida pela EDP, começamos por determinar a spot-rate curve, utilizando para o efeito, as yields de títulos de divida alemã (Bunds) como sendo taxas de juro sem risco. Os títulos do Tesouro não são activos totalmente livres de risco, uma vez que apresentam, empiricamente, alguma volatilidade, no entanto são os
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2. Cost of capital of Marriott Cost of Capital Marriott dapat dihitung dengan perhitungan WACC, yaitu: WACC=(1-t)*Rd*Wd + Re*We Re, atau cost of equity dapat dihitung dengan rumus : CAPM=Rf+b(Rm-Rf) Rf atau risk free rate-nya dapat kami ambil dari exhibit 4 untuk long-term US Government Bond untuk tahun 1987 sebesar -2.69% (karena kami melakukan perhitungan untuk perusahaan Marriott, dengan asumsi untuk jangka panjang, maka kami menggunakan rate yang long-term) Untuk Market Portfolio
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following analyses: 1. 2. 3. 4. Construct a common-size (percentage) income statement. Construct a common-size (percentage) B/S Using information from 1&2 to find out the operating efficiency Assuming the same operating efficiency in 1990, forecast cash needs for the target growth Case #2: Ocean Carriers Questions Ocean Carriers uses a 9% discount rate. 1. Do you expect daily spot hire rates to increase or decrease next year? 2. What factors drive daily hire rates? 3. How would you characterize
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860,000 (million VND) Outstanding 1,895,000,000 shares (units) Source: Student estimates Highlights We estimate PV Gas (GAS) as “HOLD” with target price of VND 79,512, expected higher than its current price 16.9%, VND 68,000. Three-stage discounted cash flows model is employed and the result is confirmed again with P/E analysis. Operation under control of government as a monopoly in gas industry: PV Gas is the only trader in dry gas market and accounted for 70% national LPG market. Restructuring
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VALUATION IN CORPORATE FINANCE BUFN 750 Case 1: Mercury Athletic Footwear Section: 0502 Group members: Wenqi Fan (114332905) Shuhan Luo (114016706) Ruidong Li (114212986) Siyao Tian (114218377) Shuang Yang (114349156) Executive Summary: Mercury Athletic is the footwear division of West Coast Fashions (WCF), a designer and distributer of branded athletic and casual footwear, targeted at youth market. Due to strategy reorganization, WCF wanted to shed this segment. In the meantime
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Robert H. Smith School of Business | Valuation | Case #4 Vodafone AirTouch’s Bid for Mannesmann | | Executive summary Vodafone AirTouch, one of the world’s leading international mobile telecommunications companies, was considering launching a formal hostile bid for Mannesmann, a German telecommunications company which is also among the largest telecommunications companies in Europe. If this come true, it will become the largest hostile takeover in the world. But now we are facing
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of equity - 12% Corporate tax rate – 30% Future profits – discounted 5% Risk factor – 25% Conservatism- risk factor (consideration due to the negative factor for pub) Question 1 Assess the economic benefits associated with each of the capital projects. What is the initial outlay? What are the incremental cash flows over the life of the project? What is an appropriate discount rate to use for discounting the cash flows of the projects? Initial Outlay Planet Karaoke Pub To
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CAPTAIN 1. RAINBOW PRODUCTS A. Rainbow should not purchase this equipment by looking at NPV as the purchase criteria because it seems that although IRR may give the false impression of 14.15% return on investment, when those cash flows get discounted at the rate of cost of capital, the total payback comes to $34,054 which means we are actually paying $946 more today compared to sum of the benefits we will get through labor costs reduction for 15 years. Machine Savings per year | $5
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