VALUATION -PROBLEM SOLVING FOR THE CASE STUDY Name Institution Instructor Course Date Question 1 Potential value creation in the transitions: 1. Use of a risk hedging financial contract‚ the swap. 2. Acquisition of an undervalued target. 3. Evading tax liability. The management under the advisory of analyst believe that the company requires to make intensive‚ heavy investments which is not feasible if the Seagate Inc. remains a public company The other capital reorganisations alternatives are
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Seagate Technology Buyout March 22‚ 2006 By: Rachel Cluck Beth Crocker Heather Preston Jessica Seal Table of Contents Introduction............................................................................3 Objectives ..............................................................................3 Overview................................................................................4 Alternatives – How to Address Seagate’s Low Stock Price ..5 Do Nothing........................
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“LA ADQUISICIÓN DE SEAGATE TECHNOLOGY” 1. Why is Seagate undertaking this transaction? Is this necessary to divest the Veritas shares in separate transaction? Porque el mercado estaba menospreciando el valor de sus acciones‚ esto ya que aun cuando Seagate Technology poseía gran parte de VERITAS (155 millones de acciones) sólo aumento en un 25% el valor de sus acciones que es nada si se compara con el 200% que aumentó el de las de VERITAS. En sí no es necesario‚ pero al hacer
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Re: Seagate Technology 1. Describe the main terms of the Seagate Technology buyout? Why is Seagate undertaking this transaction? Is it necessary to divest the Veritas shares in a separate transaction? What are other alternative ways to create value? The primary contemplated terms would be to sell Seagate’s disk drive mfg assets including $765M in cash to Suez Acquisition Company controlled by Silver Lake Partners. The purchase would be financed by equity put up by Silver Lake and also by an‚
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Seagate Technology Buyout Hard disk drives make up the largest sector of the information storage industry in 1999. The hard disk drive market can be classified into three separate categories‚ desktop‚ enterprise‚ and mobile. The mobile and desktop markets are expected to converge in the long run. While the desktop market represents approximately 58% of the $25 billion total hard disk drive market‚ enterprise margins were nearly double the margins in the desktop sector (10-15%). Since 1997‚ the number
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Seagate Buyout Case Group 5 Heng Qiao Eduardo Pereira Wei Wang Yanan Pei Introduction of the companies Seagate Technology‚ Inc. is one of the world’s largest manufacturers of computer disk drives and related data storage devices with approximately $6.5 billion in annual revenues. In early November 1999‚ Luczo‚ president and CEO of Seagate considered a restructuring proposal with Silver Lake‚ a successful private equity firm that is specified in technology business investing
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“Seagate Buyout” | Case Study Analysis | 1. Why is Seagate undertaking this transaction? Is it necessary to divest the VERITAS shares in a separate transaction? Do the shareholders of VERITAS gain or lose from this transaction? Under the original organizational structure‚ Seagate’s management believed its current stock price is undervalued by the current market and thus not delivering the value to shareholders of Seagate stock. At this time‚ Seagate also held a significant stake in VERITAS
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Case 9 & 10 Analysis Seagate Technology Buyout The Hertz Corporation Advanced Corporate Finance MW 2:00-3:15 PM Question 1 On page 1‚ the “value-gap” is two-fold. It signifies an under-valuation of Seagate’s core disk drive operating assets due to unfavorable public market investor preferences. Furthermore‚ the value of the Veritas share price has caused the Veritas stake to far outweigh the value of Seagate’s stand-alone market capitalization. Since Seagate does not own at least 80%
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Finance 448 Pulvino Seagate Technology Buyout Suggested Assignment Questions 1. Why is Seagate undertaking these transactions (the buyout and the stock swap with Veritas)? Who are the winners and losers resulting from these transactions (e.g.‚ Seagate shareholders‚ Seagate management‚ Veritas shareholders‚ Silver Lake Partners)? 2. Who benefits from generic leveraged buyouts? Who loses? Is the rigid disk drive industry conducive to a leveraged buyout? NOTE: For the purposes of questions
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megabyte of disk storage has gone done 40% per year from 1980-1995. Seagate believes that in order to stay competitive they must aggressively enhance product offerings and reduce prices. They also believe that in addition to that‚ they need to provide timely introductions and reduce production costs. However‚ the surging global demand in this industry is causing some facilities to run at full capacity very frequently‚ so Seagate needs to tailor its manufacturing strategy for these new products they’re
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