MSc in Finance Raising capital in Global markets Romain Boujiot Jen Huki Jhon Hitterman You have been hired as an international investment banker by a large U.S. institutional investor who is considering purchasing HPI stock. Provide an analysis of: i) China as an investment destination ii) key success factors iii) HPI’s strengths and weaknesses. World’s largest country by population (nearly 1/5 of the world’s population) Total Population (millions) Growth rate Source: EIU Country Report
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FIN 819: Financial Management Administrative Issues Course Overview FIN 819: Lecture 1 Today’s plan l Administrative issues l Course overview l Team formation • prerequisite • add‚ drop and withdraw • projects • case writing and discussion • final exam • final grade FIN 819: Lecture 1 The instructor l l l l l My name is George Li Office: DTC 582 and BUS 315 Email: li123456@sfsu.edu Office hours: Monday: 1:30 p.m. to 3:30
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1 The Value of Synergy Aswath Damodaran Stern School of Business October 2005 2 The Value of Synergy Many acquisitions and some large strategic investments are often justified with the argument that they will create synergy. In this paper‚ we consider the various sources of synergy and categorize them into operating and financial synergies. We then examine how best to value synergy in any investment and how sensitive this value is to different assumptions. We also look at how this synergy value
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BLAINE KITCHENWARE INC. Blaine Kitchenware was a mid-sized producer of small appliances primarily used in residential kitchens. By 2006‚ the company’s products consisted of a wide range of small kitchen appliances including deep fryers‚ griddles‚ toasters‚ ovens etc. Blaine had just under 10% of the $2.3 billion U.S. market for small kitchen appliances. For the period 2003 to 2006‚ the industry posted modest annual unit sales growth of 2%. In 2006‚ 65% of its revenue was generated from shipments
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dividends as John’s? Assume you can borrow or lend at 5%. 2. Carlson Enterprise is financed entirely by common stock with a beta of 0.6. There are no taxes. The market expected return is 11%. The company decides to repurchase one fourth of its common stock and substitute with an equal value of debt. If the debt yields the same as the risk-free rate of 3%‚ calculate: (a) the beta of the common stock after the refinancing (b) the required return and risk premium on the common stock before and after
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EXECUTIVE SUMMARY Spirit Airlines (SAVE) is an ultra low-cost‚ low-fare based in Fort Lauderdale‚ Florida that provides affordable travel opportunities. The IPO for Sprit airlines was offered on June 11th‚ 2011. The price of the stock at the IPO date was of $12.00. According to NASDAQ.com‚ the money that was raised on the IPO was $187.2 million dollars‚ with 5 million dollars in expenses. After the underwriting cost eliminated they approximately raised171.0 million. After the IPO sale
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Blaine Kitchenware Case Study Answers 1. ABOUT THE COMPANY Blain Kitchenware‚ Inc. (BKI)‚ founded in 1927‚ is a mid-sized producer of small appliances for residential kitchens. BKI has an approximate 10% market share of the $2.3 billion U.S. market for small kitchen appliances‚ with 65% of sales originating from the US market. The company is public since 1994‚ and the majority of the shares is controlled by the founder’s family (62% of outstanding shares)‚ who also have a strong representation in
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capital (WACC) of AirThread. Approach to value AirThread before considering any synergy 1. Develop a projection of unlevered free cash flow for AirThread. * Discount AirThread’s unlevered free cash flows at unlevered WACC. 2. Determine the PV of interest tax shield: * Discount AirThread’s interest tax shield by debt cost of capital (interest rate of debt). 3. Add the unlevered value to the PV of interest tax shield to get the value of the acquisition. 4. Using Dividend Discount Model (Gordon
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1. How much value do you expect to be created by operating improvements and capital structure changes envisioned by CD&R? CD&R proposed changes to the following areas. a. US RAC on-airport operating expenses: Labor per transaction‚ administrative and other costs had increased 41%‚ 65% and 30% respectively between 2000 and 2005. In addition‚ margins were not constant across locations and varied from 32% to -7%. CD&R proposed that the operating expenses could be reduced resulting in cost savings
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several ways: 1. WACC METHOD; discount unlevered free cash flows using the weighted average cost of capital (WACC). Because we calculate the WACC using the effective after-tax interest rate as the cost of debt‚ therefore this method incorporates the tax benefit of debt implicitly through the cost of capital. 2. ADJUSTED PRESENT VALUE METHOD (APV); first value a projects free cash flows without leverage by discounting them using the unlevered cost of capital. Then separately estimate and
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