Mergers and Acqusitions
MGMT E 2720 Mergers and Acquisitions
Supplemental Case Questions
1. The New York Times
a. Why is there so much family control in the newspaper business?
b. How did the Sulzberger family manage to retain control on the NYT after it went public?
c. How does the NYT dual class structure differ from the one used by Dow Jones, prior to its takeover by Rupert Murdoch?
d. What explains the behavior of the NYT institutional shareholders – not just Morgan Stanley but also Private Capital Management, T Rowe Price and Vanguard?
e. How should Arthur Sulzberger, Jr. respond to Morgan Stanley’s proposal?
2. Valuing AOL Merger
a. The Merger was completed on January 11, 2001. Was it a good idea? Did AOL stockholders receive value? Did Time Warner shareholders receive value?
b. Do you believe the new company will succeed? If so, how will value be created short and long term?
c. What could go wrong with this “mega merger”? What are the most significant threats on the horizon for AOL Time Warner?
d. Do you believe the company will achieve its aggressive goals for 2001?
e. Any advice for AOL Time Warner execs in summer of 2001?
3. Upjohn Case
a. Evaluate the strategic reasoning behind the merger. Will the merger effectively address the strategic alliances faced by Upjohn?
b. How do you interpret the stock market reaction to the announced deal? What is the magnitude of performance improvement the market is expecting? Are these realistic?
c. Can you create an alternative restructuring strategy that might address the strategic challenges of Upjohn better? What are the risks and rewards from you strategy?
d. As a shareholder of Upjohn, would you support this merger?
4. Middleby
a. What caused Middleby's struggles in the 1990s?
b. To what extent were these exogenous versus endogenous i.e. what if anything could management have done?
c. What did
Supplemental Case Questions
1. The New York Times
a. Why is there so much family control in the newspaper business?
b. How did the Sulzberger family manage to retain control on the NYT after it went public?
c. How does the NYT dual class structure differ from the one used by Dow Jones, prior to its takeover by Rupert Murdoch?
d. What explains the behavior of the NYT institutional shareholders – not just Morgan Stanley but also Private Capital Management, T Rowe Price and Vanguard?
e. How should Arthur Sulzberger, Jr. respond to Morgan Stanley’s proposal?
2. Valuing AOL Merger
a. The Merger was completed on January 11, 2001. Was it a good idea? Did AOL stockholders receive value? Did Time Warner shareholders receive value?
b. Do you believe the new company will succeed? If so, how will value be created short and long term?
c. What could go wrong with this “mega merger”? What are the most significant threats on the horizon for AOL Time Warner?
d. Do you believe the company will achieve its aggressive goals for 2001?
e. Any advice for AOL Time Warner execs in summer of 2001?
3. Upjohn Case
a. Evaluate the strategic reasoning behind the merger. Will the merger effectively address the strategic alliances faced by Upjohn?
b. How do you interpret the stock market reaction to the announced deal? What is the magnitude of performance improvement the market is expecting? Are these realistic?
c. Can you create an alternative restructuring strategy that might address the strategic challenges of Upjohn better? What are the risks and rewards from you strategy?
d. As a shareholder of Upjohn, would you support this merger?
4. Middleby
a. What caused Middleby's struggles in the 1990s?
b. To what extent were these exogenous versus endogenous i.e. what if anything could management have done?
c. What did