$168 million of Restructuring and special charges in 1992 Stakeholders •Absolute vs Relative priority •Secured claims ($159 million) prefer a low a value •Senior unsecured claims ($88 million) •12.5% junior debtholders‚ 9% debtholders •Junior Debt: 12.5% & 9% Debt ($40 & 16 million) •vultures purchased $16 million at 80-85% off face value •equity: likely wiped out including ESOP •management •cramdown
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characteristics that customers preferred. Four new product categories emerged within the small car category matched to customers’ needs: A—economy‚ practical; Basic-B—stylish‚ good value; Trend-B—high performance‚ features; Other-B—luxury and sports derivatives. Ford’s Strategy By 1992‚ the success of the Twingo had redefined the entire B
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1. How would you evaluate the capital budgeting method used historically by AES? What’s good and bad about it? Historically‚ the AES capital budgeting method primarily used the following assumptions: • All nonrecourse debt was regarded as good • Dividend cash flow were considered equally risky • Project was evaluated by the equity discount rate for the dividends from the project • A 12% discount rate was applied to all projects. The historical method is quite simplistic
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ingredients are imported from around the world. Additionally‚ Boston Beer relies heavily on contract brewing to gain competitive advantages. Boston Beer’s contract brewing strategy results in lower overhead and transportation costs‚ as well as greater manufacturing flexibility. The expenses Boston Beer saves through contract brewing allows for an increased marketing budget and intensive sales force‚ which is greatly important for differentiating products in a saturated market. Boston Beer’s strategy appears
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Although Skilling was the one at the forefront when the Enron ship began to sink‚ the presence of many strong players all competing for individual power within the organization attributed to Enron’s downfall. Although Skilling came in fresh out of HBS ready to aggressively hit the ground running‚ it seems as higher management at the time‚ namely Lay‚ did not have the foresight to control
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Q1. How attractive is the video game console industry in 2008? The video game industry can be seen as part of the broader entertainment industry‚ which is a sector that involves most part of the population all over the world‚ especially in the developed countries. The more countries will develop‚ the broader the entertainment industry’s consumer base will become‚ with the consequence of greatly widening video game industry’s potential customers. More specifically‚ video game console industry has
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Case 6-1 Tempo Ltd. In this case Fatih Terim is trying to decide whether or not to enter a barter trade with North Koreans in which he would send Turkish chemicals in exchange for kereste (Lumber). Because of trade sanctions between Turkey and North Korea this transaction would not be legitimate because there would be some bribing and other extracurricular activities to complete the deal. Terim tried to justify going through with the deal because he concluded that if he did not make the deal then
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Case Background George Lassiter makes t-shirts for special events such as concerts. The upcoming concert presents another opportunity for George to make and sell t-shirts; however the question is how many t-shirts to produce. There are two fundamental case questions that must be answered: 1. What are the possible financial outcomes if Lassiter orders 5‚000 T-shirts? 7‚500? 10‚000? As shown in the Exhibit‚ a rather simple but detailed decision tree has been made which represents the various options
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AT&T was started over 130 years ago in 1875. It started out when Alexander Graham Bell began work on the telephone. Initially it just made telephones and licensed to companies to Many changes in the company structure 6‚000 patents 7 Nobel prizes Analysis I. General Environment A. Technology Alexander Graham Bell invented the telephone and earned the patent in 1875. AT & T was incorporated in 1885 with objective of building and operating long distance network. AT & T was the
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Dorchester Ltd. Summary of Key Information The current exchange rate in European terms is So(£/$) = 1/1.50 = .6667. The initial cost of the project in British pounds is SoCo = £0.6667($7‚000‚000) = £4‚666‚900. The U.K. inflation rate is estimated at 4.5% per annum‚ or the mid-point of the 4%-5% range. The U.S. inflation rate is forecast at 3% per annum. Under the simplifying assumption that PPP holds [pic] = .6667(1.045)t/(1.03)t. The before-tax nominal contribution margin per unit at t=1 is
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