Interco Summary of the Case Even before we go into the specifics of the case, we can point out a few important pieces of information from the case: 1) Interco management and Wall Street analysts believed that the apparel group’s performance would continue to weaken Interco’s overall operations and cause the equity markets to undervalue its common stock. Case Page 4. 2) To deter any unwanted third- party acquisition, the board voted on July 11, 1988, to amend Interco’s shareholder rights plan, making any hostile takeover of the company prohibitively expensive. Case Page 4. 3) Interco had retained Wasserstein Perella pursuant to a unique compensation contract that offered a substantial contingency fee of $3.7 million payable to Wasserstein …show more content…
Premiums associated with tender offers, as measured against stock prices one day or one week prior to the offer announcement, would be affected by information leakage and the extent to which a company was viewed as “in play” by the arbitrage community. And the issue of fairness would seem to depend more on the absolute, not relative, degree to which the Rales brothers’ bid exceeded the current stock price. See exhibits 3 and 4. Do you think analysis in Exhibit 10 justifies rejecting the bid? 3 Exhibit 4 tells us that the stock price of Interco started going up in July from about $44 to $72 on the day of the Board meeting. This tells us that markets anticipated that Inteco is a target for acquisition and increased the stock price of Interco in anticipation of an acquisition premium. 4 Comparable Transaction Analysis The comparable transaction analysis yields values ranging from $2 billion to $6.4 billion. Given such a wide range of numbers, it is not possible to pinpoint or arrive at reasonable estimates of value for Interco. 5 Discounted cash flow analysis in Exhibit 12 We do not know the beta for Interco’s equity. Therefore, it is not possible for us to estimate the weighted average cost of capital (WACC) for Interco. Note that here WACC method is appropriate because Interco is not
Whenever I am asked where I am from I always respond, “South Texas”. People will reply with a question, San Antonio? , and I usually have to clarify that I am south of San Antonio, about four hours away no San Antonio is not south texas, the Rio Grande Valley is south texas. In the Rio Grande Valley there is a town named Weslaco around five minutes from the border of Mexico. We live in a community swarming with Mexican culture. Our city’s population is approximately 36,000 and from this population about 85 percent is composed of Hispanics or Latinos. As if we are our own country we have our own language which consists of Spanish, English, and Spanglish. We are knee deep in culture so it is easy to be against the norms in our community, and personally I have dealt with this problem.
Primarily responsible for the investigation into criminal violation(s) of the Immigration & Nationality Act (INA) that occur at the port of entry in violation of Title 8, Code of Federal Regulations and Title 18 United State Code. Conduct sworn statements, personal search,baggage search and review collected evidence. Conduct research of the criminal statute and immigration law to cite section(s) of law violated. Review completed case and determine if the case falls within US Attorney guidelines for acceptance. Liaison with Assistant US Attorney to seek acceptance of the case. Prepare criminal complaint in accepted cases and present to Assistant US Attorney. Testify in federal court during the proceedings as the government witness.
The Association of Intercollegiate Investment Clubs (ACIIC) provides three key benefits; developing and enhancing students through mentorship, encouraging the development of interpersonal skills through collaboration and bridging the gap between the capital markets and university students. These benefits are precisely the reason why I am pursuing the ACIIC so ardently. With recruiting cycle underway, I am interested in exploring the skill development and recruiting preparation analyst tracks to help better understand how to do well in this cycle. Furthermore, I think there is a lot of value in the alumni network of the ACIIC, given the high caliber of students that have gone through the program.
‘Critically discuss the Basic Skills Component Domains within the Children and Young People’s IAPT Project and the challenges in applying them in your service.’
CTC is definitely a company worth investing in. Due to the fact CTC is such diverse company no retailer in either the ‘brick and mortar or online’ sector competes directly with CTC. With so many departments and offerings for clients CTC is almost guaranteed to always be in a position of success because if one of its sectors were to experience any downfall there is a strong support system in place with its other offerings and strong and reliable history. A relatable way to truly appreciate the stable state of CTC is provided to the public on their website and listed as ‘Fun Facts’. Some of these facts that are the most interesting include: “The Canadian Tire Family of Companies sells enough rolls of hockey tape to connect Victoria and Halifax
There is the fear that there won’t be synergy or the integration of different organizational designs and cultures might clash. The premium that will be paid is based on future expectations of synergies. If synergy fails, the premium of $6.6 billion dollars will be money lost, so that is cause for concern and have another look at this acquisition. To be able to have a successful merger and acquisition, there are phases that you go through thoroughly to make sure the right decision was reached. In the book Valuation: Measuring and Managing the value of Companies, the authors noted the following (Evans, 2000 P. 7):
For the WACC project, I chose to do on CVS pharmacy and they operate in the healthcare industry. CVS together with its subsidiaries provides integrated pharmacy healthcare services in the United States. The cost of equity is 10.21% and the cost of debt is 4.67%. Beta of 1.058 was used to calculate cost of equity. This value was obtained after I averaged value of beta from three sources – 1.17 from Yahoo Finance, 1.00 from Google finance and 1.004 from regression analysis. WACC for CVS is 10.27%.
* Compute the value with leverage, VL, by discounting the free cash flows of the investment using the WACC.
Bill Fender, president of Flinder Valves & Controls Inc. (FVC) and Tom Eliot, CEO of RSE International are trying to determine final details on RSE acquisition of FVC. Formal conversation have been going-on for approximately 3 months. During this time they and their respective advisors have:
The acquisition premium is the difference between the actual costs for acquiring a target firm versus the estimate made of its value before the acquisition. On May 1st 2008, FVC’s market value was worth is $39,75 (price close in exhibit 6) x 2.440.000 shares = $
2. Evaluate the two offers in Exhibit 7. What explains the two structures? In each case, what is the value to MCI shareholders?
5. Assume that RSE considers paying for the acquisition by issuing additional common stock (a share-for-share exchange) and the current market price of RSE’s stock accurately represents the value of RSE’s stock. What range of exchange ratios could RSE offer to FVC and still benefit from the deal?
After the deal was announced, the prices moved towards equilibrium. Our price went to £7.90 while the price of McPhee shares went to £6.32:
*This will make the intrinsic value of eBay about $59.5 million, should eBay decide to issue the 3.5 million shares. This $59.5 million will be very beneficial for eBay's future growth. (Exhibit 2)