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1 – 10 of 39David P. Stowell, Tim Moore and Jeff Schumacher
Are hedge funds heroes or villains? Management of Blockbuster, Time Warner, Six Flags, Knight-Ridder, and Bally Total Fitness might prefer the “villain” appellation, but Enron…
Abstract
Are hedge funds heroes or villains? Management of Blockbuster, Time Warner, Six Flags, Knight-Ridder, and Bally Total Fitness might prefer the “villain” appellation, but Enron, WorldCom, Tyco, and HealthSouth shareholders might view management as the real villains and hedge funds as vehicles to oust incompetent corporate managers before they run companies into the ground or steal them through fraudulent transactions. Could the pressure exerted by activist hedge funds on targeted companies result in increased share prices, management accountability, and better communication with shareholders? Or does it distract management from its primary goal of enhancing long-term shareholder value?
To determine the benefits and disadvantages of activist hedge fund activity from the perspective of corporate management and shareholders; to examine if a hedge fund's suggested corporate restructuring could create greater shareholder value; and to explain the changing roles and perspectives of hedge funds.
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Vishal Gupta and Priyanka Premapuri
The ‘CSIR-Tech: Facilitating lab to market journeys’ case is designed to teach students the strategic intricacies of an organizational network. The case also throws light on the…
Abstract
The ‘CSIR-Tech: Facilitating lab to market journeys’ case is designed to teach students the strategic intricacies of an organizational network. The case also throws light on the formation and design of a collaborative inter-organizational network. CSIR, a premier R&D organization in India, was plagued with challenges in the commercialization of technologies developed in its constituent laboratories. CSIR-Tech was established as a private-limited company to catalyse the technology development and commercialization process. The case analyses formation of CSIR-CSIR-Tech alliance and discusses how the alliance can help in overcoming challenges associated with commercialization of technologies being developed at CSIR.
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Tripti Ghosh Sharma, Vishesh Srajan Tyagi, Laksh Sharma and Rupayan Banerjee
Social enterprise, Social entrepreneurship.
Abstract
Subject area
Social enterprise, Social entrepreneurship.
Study level/applicability
PGDM, PGDM Executive.
Case overview
The case is about the evolution of a unique social organization, BloodConnect, over its journey of four years. Initiated by two Indian Institute of Technology (IIT) Delhi students in 2010, the organization went on to be recognized for making leeway into the hitherto underserved need of blood security in India. The case describes BloodConnect's evolution with respect to different dimensions of blood shortages and the organization's acquisition of knowledge over the years. BloodConnect acted as a facilitator to bring multiple stakeholders, including potential donor segments, beneficiaries, hospitals, government and NGOs, on the same platform to collectively identify solutions, thereby increasing the ownership of each segment toward an issue of importance to the society. While the organization started gaining visibility and was on its way to making its operation structured, it desired to move beyond the confines of Delhi-NCR to raise the movement to the national level, but it was faced with challenges peppered with lack of resources, lack of funds, absence of a permanent leadership and complex dynamics between the multiple stakeholders. Donor dependency for funds and amateur management were the other major impediments for its sustenance. The case brings forth the major challenges threatening the very existence of the organization as it grappled to identify solutions that could provide revenue sustainability without dampening its mission of creating social value. The case is of relevance to social enterprises in the context of a developing nation as most of the low and middle income countries face similar challenges pertaining to blood security. It also brings forth the issues of survival, scalability and the concept of social value measurement. In what are the myriad hurdles faced by start-ups, the traditional metrics might not be enough while measuring the impact created by a social enterprise.
Expected learning outcomes
To develop an insight into the unique challenges faced by start-up social ventures and options available to them for growth and subsequent consolidation. To enhance the understanding of interrelationship between mission focus, scale of operations, revenue sustainability and social impact. To introduce students to the concept of social value measurement. The students would be able to appreciate the uniqueness of the metrics specific to a social venture.
Supplementary materials
Teaching notes are available for educators only. Please contact your library to gain login details or email support@emeraldinsight.com to request teaching notes.
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Nicola Persico and C. James Prieur
In 2007 Conseco's CEO, C. James Prieur, faced a complicated set of problems with his company's long-term care (LTC) insurance subsidiary, Conseco Senior Health Insurance (CSHI)…
Abstract
In 2007 Conseco's CEO, C. James Prieur, faced a complicated set of problems with his company's long-term care (LTC) insurance subsidiary, Conseco Senior Health Insurance (CSHI). CSHI faced the threat of congressional hearings and an investigation by the U.S. Government Accountability Office, triggered by an unflattering New York Times article alleging that CSHI had an unusually large number of customer complaints and was denying legitimate claims. This threat came in addition to broader systemic problems, including the fact that the entire LTC industry was barely profitable. What little profitability existed was dependent on the goodwill of state insurance regulators, to whom the industry was highly beholden for approvals of rate increases to keep it afloat. Furthermore, CSHI had unique strategic challenges that could not be ignored: First, the expense of administering CSHI's uniquely heterogeneous set of policies put it at a disadvantage relative to the rest of the industry and made rate increases especially necessary. Second, state regulators were negatively predisposed toward Conseco because of its notorious reputation and thus were often unwilling to grant rate increases. Finally, CSHI was dependent on capital infusions totaling more than $1 billion from its parent company, Conseco, for which Conseco had received no dividends in return. Faced with pressure from Conseco shareholders and the looming congressional investigations, what should Prieur do? Students will discuss the available options in the context of a long-term relationship between Conseco and state insurance regulators. Prieur's solution to this problem proved to be innovative for the industry and to have far-reaching consequences for CSHI's corporate structure.
After reading and analyzing this case, students will be able to: evaluate the impact of a regulatory environment on business strategy; and assess the pros and cons of various market strategies as well as recommend important non-market strategies for a firm in crisis in a highly regulated industry.
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Masahiro Toriyama, Mohanbir Sawhney and Katharine Kruse
In late 2019, Dr. Hiroaki Kitano, the president and director of research at Sony Computer Science Laboratories (Sony CSL), had decided he would be stepping down from his position…
Abstract
In late 2019, Dr. Hiroaki Kitano, the president and director of research at Sony Computer Science Laboratories (Sony CSL), had decided he would be stepping down from his position soon. Sony CSL, a small blue-sky fundamental research facility funded by Sony, had always operated on the strength of the trust between Sony's CEO and the lab's director. Sony had been hands-off in its management, leaving Kitano to hire, fire, fund, and evaluate the lab's researchers and project portfolio at his own discretion. Now that he was stepping down, however, he worried that Sony CSL could not withstand his departure. Kitano wanted to make a transparent plan for the organization's future before he handed off Sony CSL to his successor. That plan involved three key decisions. First, what should be the optimal structure and governance of Sony CSL? Should it maintain its independence and autonomy, or should it align more closely with Sony's business priorities? Second, how could Sony CSL scale its impact on Sony and society at large, given its small size? Finally, should Sony CSL establish some standard methods of measuring project success and strength of the portfolio? In making these decisions, Kitano wanted to ensure that he preserved the unique culture that had allowed Sony CSL to pursue path-breaking research and innovation.
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Robert F. Bruner, Casey S. Opitz and Renee Weaver
In March 1997, the board chair of this small steel mill is pondering how to finance the growth of his firm: either with an initial public offering of equity or a private placement…
Abstract
In March 1997, the board chair of this small steel mill is pondering how to finance the growth of his firm: either with an initial public offering of equity or a private placement of 8-year senior notes with warrants. The task for the student is to sort out the comparative advantages and disadvantages of each alternative—including valuing the possible securities—and recommend a course of action.
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David P. Stowell and Nicholas Kawar
During December 2012, Jorge Paulo Lemann, a co-founder and partner at 3G, proposed to Warren Buffett that 3G and Berkshire Hathaway acquire H. J. Heinz Company. Lemann and…
Abstract
During December 2012, Jorge Paulo Lemann, a co-founder and partner at 3G, proposed to Warren Buffett that 3G and Berkshire Hathaway acquire H. J. Heinz Company. Lemann and Buffett, who had known each other for years, jointly decided that the Heinz turnaround had been successful and that there was significant potential for continued global growth. 3G informed Heinz CEO William Johnson that it and Berkshire Hathaway were interested in jointly acquiring his company. Johnson then presented the investors' offer of $70.00 per share of outstanding common stock to the Heinz board.
After much discussion, the Heinz board and its advisors informed 3G that without better financial terms they would not continue to discuss the possibility of an acquisition. Two days later, 3G and Berkshire Hathaway returned with a revised proposal of $72.50 per share, for a total transaction value of $28 billion (including Heinz's outstanding debt).
Following a forty-day “go-shop” period, Heinz, 3G, and Berkshire Hathaway agreed to sign the deal. But was this, in fact, a fair deal? And what might be the future consequences for shareholders, management, employees, and citizens of Pittsburgh, the location of the company's headquarters? Last, what was the role of activist investors in bringing Heinz to this deal stage?
After reading and analyzing the case, students will be able to:
Understand the influence of investment bankers on M&A transactions
Consider synergies that drive M&A
Consider the role of activist investors in corporate strategic decision-making
Understand the impact of M&A on key corporate stakeholders
Apply core valuation techniques to support M&A valuation
Understand the influence of investment bankers on M&A transactions
Consider synergies that drive M&A
Consider the role of activist investors in corporate strategic decision-making
Understand the impact of M&A on key corporate stakeholders
Apply core valuation techniques to support M&A valuation
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Read any news report on the housing market, and inevitably it will include facts or figures from the real estate data giant Zillow.com. The company initially set out to solve two…
Abstract
Read any news report on the housing market, and inevitably it will include facts or figures from the real estate data giant Zillow.com. The company initially set out to solve two key economic frictions in the real estate industry information asymmetry and the principal-agent problem by empowering users to access real-time housing data and eliminating the need for realtors. The company soon realized, however, that American homeowners and buyers were not willing to give up the traditional real estate agent model and changed course. In the end, Zillow decided to join rather than replace the middlemen in the real estate industry.
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Russell Walker and Andrew Dilts
Polaris Battery Labs was an Oregon-based startup that provided innovation services to companies in the lithium ion battery industry. Its operating philosophy and expertise in this…
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Polaris Battery Labs was an Oregon-based startup that provided innovation services to companies in the lithium ion battery industry. Its operating philosophy and expertise in this fast-growing industry enabled it to provide great value to its clients, but as a startup that was seeking growth the company was subject to multiple risks.
For Polaris, taking clients, developing new manufacturing capabilities to meet unproven battery technologies, and even extending credit to its clients posed real risk. Many of its clients were startups themselves and had a significant probability of failure. Others were established firms testing new and unproven battery technologies, many of which were unlikely to gain traction in the market.
The case examines how a technology-driven firm managed the risk of working with startups, claiming appropriate intellectual property, and developing a sustainable portfolio of clients.
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Students will need to know basic capital budgeting techniques to value UrsaNav and its divisions. Students must determine which cash flows are relevant and determine an…
Abstract
Theoretical basis
Students will need to know basic capital budgeting techniques to value UrsaNav and its divisions. Students must determine which cash flows are relevant and determine an appropriate return on investment. Some of the issues that need to be addressed include: how to handle taxes in a discounted cash flow analysis when valuing an S Corp. where incentives depend on current (known) tax provisions and future (unknown) tax provisions; how to use comparable multiples to develop a cost of capital for a DCF valuation; and how to value a firm using comparable transactions.
Research methodology
Case information was obtained through interviews with the owner, Charles Schue. In addition, the authors researched industry and comparable company data, along with current events relating to government consulting.
Case overview/synopsis
UrsaNav is a US-based, international provider of advanced engineering and information management consulting services in the naval navigation industry. After about a decade of operating and growing, the firm had become successfully diversified; however, it had also grown too large to manage effectively. Thus, the company was spun-off into three separate segments: Tagence, Geodesicx and UrsaNav. These segments went “back to the basics,” and focused more on serving customers, with each having a more defined company focus. Is this a move that creates or destroys value? How could it create value for the firms’ founders?
Complexity academic level
This case is intended for an advanced undergraduate or an MBA corporate finance class or an entrepreneurship elective. Students interested in analyzing whether or not decision makers within a company would want to spin-off divisions, or merge with another company, or divest a company would find this case appealing. Other students who just want to analyze whether the company has grown too much would be good candidates to do this case.
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