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Disnye Marvel Acquisition

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Disnye Marvel Acquisition
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Report Information from ProQuest
October 10 2011 17:36

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Disney's Marvel acquisition: a strategic financial analysis
Calandro, Joseph. Strategy & Leadership38.2 (2010): 42-51.

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Abstract
The purpose of this paper is to assess the value and risks of Disney's 2009 $4 billion acquisition of the Marvel Entertainment Group (Marvel) in a case study utilizing the modern Graham and Dodd valuation approach. The paper presents a detailed valuation of Marvel in 2009 drawing on previously published Graham and Dodd methodological materials and Marvel's publicly available financial reports. Disney's $4 billion acquisition price for Marvel contained considerable risks based on certain valuation assumptions, which were identified in the context of our analysis. This acquisition is a useful one for executives to study because it involves a situation many of them could face: evaluating the purchase of a great company that is seemingly a strategic fit and offered at what appears to be a reasonable price. Assessing such opportunities utilizing the modern Graham and Dodd valuation approach facilitates greater levels of insight into key assumptions, value drivers, and risks. This is a methodology that has proved useful to successful value investors over time. Lessons executives in many industries can learn from a Graham and Dodd-based valuation of the 2009 Disney acquisition of Marvel include: better risk assessment, valuation of entertainment property assets and franchise assessment.

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