Mergers, Acquisitions, and
Other Corporate Restructuring Activities
MBAF 624 Course (40962) Syllabus-Fall 2005
Monday: 7:15 to 10:00 P.M., Hilton 023
Instructor:
Name: Don DePamphilis, Ph.D.
Office: Hilton 210
Phone: 310-338-7415
E-mail: dondepam@pacbell.net (easiest way to contact) or ddepamph@lmu.edu
Office Hours: Mondays 4:00-7:00 P.M.; Wednesdays 1:00-4:00 P.M.; or by appointment.
Course Overview:
Learning Objectives: Students will
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
Investigate what corporate restructuring is and why it occurs;
Evaluate the impact of the regulatory environment on M&A activity;
Analyze how value is created (or destroyed) as a result of corporate mergers, acquisitions, divestitures, spinoffs, etc., through in-depth analysis of how to “do a deal.”;
Assess how risks associated with the various approaches to creating value can be identified and managed;
Evaluate commonly used takeover tactics and defenses;
Apply a process for selecting appropriate takeover tactics depending upon the types of anti-takeover
defenses in place at a target company;
Deduce how and when to apply valuation techniques under special circumstances;
Assess the practical limitations of the various valuation techniques;
Investigate the importance of understanding assumptions underlying business valuations;
Apply a highly practical “planning based approach” to managing the acquisition process;
Evaluate challenges associated with each phase of the M&A process from developing acquisition plans
through post-closing integration;
Investigate the advantages and disadvantages of alternative deal structures;
Investigate how the various components of the deal structuring process interact to determine price;
Analyze how to manage the deal structuring process to minimize the risk that a business combination will
not meet expectations;
Evaluate advantages and disadvantages of alternative ways to exit businesses;
Apply financial modeling tools to evaluating mergers and acquisitions;
Apply the many tools and skills that have been learned in this and other courses in an integrated manner in
completing an acquisition; and
Investigate alliances/joint ventures as alternatives to mergers and acquisitions.
Description: The course is divided into two discrete sections: (1) developing an in-depth understanding of how
and when to apply the appropriate tools and skills to successfully complete a transaction and (2) the application
of what has been learned to solving “real” world business problems. All major elements of the acquisition
process will be discussed in the context of a logical process. The course will involve the application of what the
student may have learned in such courses as finance, accounting, business law, micro and macroeconomics,
management, negotiation, new ventures, entrepreneurship, strategic planning, and business policy/organization.
As part of pre-class preparation and in-class discussion, students will be asked to solve both quantitative and
qualitative problems and to analyze both publicly traded and privately owned companies involving valuing
synergy, control premiums, and leveraged buy-outs. Illustrations will include practical ways to evaluate IPOs,
new ventures, and internet-related companies.
Students will be asked to form acquisition teams to develop highly realistic business and acquisition plans that
could be used to convince top management of an acquiring corporation, a venture capital firm, or a lender to
fund their proposal. The focus will be on how to effectively manage the process. As a key part of the learning
experience, the course will require primary research to obtain the necessary data to develop the acquisition plan,
working within teams, and the development of project management skills. The professor will illustrate how the
process works in practice by drawing upon his personal experience in managing more than 30 acquisitions,
divestitures, alliances, joint ventures, equity partnerships, minority investments, and licensing arrangements from
the planning through implementation stages.
The professor will frequently relate concepts discussed in class to transactions currently in the news to illustrate
their application and limitations.
Who should take this course?: Those who are seeking to become entrepreneurs, financial analysts, chief
financial officers, operating managers, investment bankers, business brokers, portfolio managers, investors,
corporate development managers, strategic planning managers, bank lending officers, auditors, venture
capitalists, business appraisers, actuaries, corporate attorneys, or who simply have an interest in the subject.
Prerequisites: The course presumes that students have knowledge of basic accounting, economics, and
financial management concepts and tools. Students should have had at least one course in accounting, finance,
and economics within the last two years or relevant work experience.
Required Text: Mergers, Acquisitions, and Other Restructuring Activities: An Integrated Approach to Process,
Tools, Cases, and Solutions, 3rd edition, Donald M. DePamphilis, Elsevier/Academic Press, San Diego, Ca.,
2005. The text will be referred to as DePamphilis throughout this syllabus.
Other Required and Optional Reading: Unless otherwise noted, the textbook contains all case studies
required for this course, except for the following, which are available on Blackboard:
BigCo Acquires Upstart Corporation
Financing LBOs: The SunGard Transaction
Forecasting Business Performance
Illustrating the Free Market Process of Creative Destruction: Consolidation in the
Telecommunications Industry
News Corp Acquires Stake in Hughe’s DirecTV
P&G Buys Gillette
Valuation Methods Employed in Investment Banking Fairness Opinions (Optional)
Computer skill requirements: Students will need to know how to use spreadsheet software (e.g., Microsoft
Excel) no later than the fourth class meeting.
Grading: Students will be evaluated in five different ways:
Grade Points:
Examination (2 exams—100 points each)
Acquisition Team Project (see discussion below)1
Peer Review (see discussion below)
Problem Set
Class participation (see discussion below)
200 points
250 points
25 points
50 points
75 points
600 points
1
Team project leaders have the potential to earn an additional 20 points based on an anonymous review of their
performance by other team members.
Final letter grades will be assigned according to the following point scale:
A 576 - 600
A- 555 - 575
B+ 540 - 554
B 500 - 539
B- 490 - 499
C 450 - 489
D 425 - 449
F
< 425
At the end of the year, the professor reserves the right to lower the scale in the student’s favor.
2
Assignments will not be accepted after their due date, which is defined as the end of the class on the day on
which they are due. If the student is unable to attend a class, the student is expected to send the instructor the
assignment via e-mail no later than the due date. Make-up examinations will be given only in cases of verified
illness or death in the immediate family. The best way to contact me is through e-mail (see first page for
address).
Students are encouraged to ask the professor at any time for an “informal” evaluation of how they are doing in
the class.
Class Participation. Learning to speak clearly and succinctly on an impromptu or informal basis in large
groups is an essential skill that needs to be developed in whatever career the student pursues. In the workplace
environment, we are often judged as much by what we don’t say as by what we do. Under no circumstances will
a student have to feel concerned about being embarrassed in front of their classmates. In-class discussion will
always be treated in a professional, non-threatening manner.
In the absence of active participation, the professor will call on students. Active participation is defined to
include both questions and comments. To receive the maximum number of points in this category, the student
will be expected to participate during every class by asking questions or by making thoughtful comments. The
quality of both questions and comments will receive greater weight than frequency in determining the final
participation point score. Obviously, the student must attend most of the classes in order to get the maximum
number of points.
Acquisition Team Project: Early in the term students will divide into “teams” of four-to-six students each to
share the research, analysis, and field work required to design a viable corporate acquisition proposal. The
purpose of the Acquisition Project is to give students the opportunity to apply the tools they have learned in an
increasingly common situation, i.e., mergers and acquisitions.
Each team will be asked to represent an acquiring company or investment group whose business strategy
involves an acquisition or merger. The acquiring and target firms must be in the same industry. The acquisition
can involve a recent transaction (i.e., last 12 to 18 months), a current transaction, or a hypothetical transaction
involving two publicly traded firms, private companies, or some combination. The use of publicly traded
companies will facilitate data collection, and the selection of companies in the same industry will simplify the
analysis by eliminating the need to analyze two different industries.
Selecting Companies to Study: The success of the Project will be greatly dependent on the Team’s ability to
understand the company’s operations, products, and the competitive dynamics of the industry in which it
competes and to obtain financial, technical and market-related information on the company. Teams are
encouraged (but not required) to select a publicly traded company, because both internal financial and operating
data, as well as market/industry data, is likely to be more readily available (e.g., through Disclosure, Value Line,
Standard & Poors Corporate Register, Thomas Register, etc.) than for a privately owned firm.
It is helpful, although not essential, that the acquiring companies, target companies, or corporate divisions you
evaluate be located in Southern California. This would enable teams to interview key corporate personnel to
obtain additional information. Keep in mind that detailed financial information on publicly traded companies is
likely to be available only on a consolidated basis. Consequently, efforts to obtain detailed financial information
on a specific operating division of a diversified publicly traded company are likely to be very frustrating.
While there are no restrictions on the size and type of company you select, I suggest that teams select relatively
small, uncomplicated businesses such as single product, independent companies or operating units within larger
companies. For those teams that choose to select privately owned companies here in Southern California, small
companies, particularly those that are considering “going public” or attempting to obtain additional funding from
venture capitalists, may be more receptive to cooperating with your team. Contacting the president, general
manager, or chief financial officer of the company or division is a good place to start. Commercial and industrial
parks (e.g., the Irvine Spectrum in Irvine, California) offer dozens of potential candidates for your analysis.
For those that choose a private company, assure management that they will be provided with a final report and
presentation in order to more readily obtain the necessary information. Emphasize to senior management that
3
the report will contain a recommendation(s) of how to increase the “going concern” value of their business and a
valuation of the business. Also emphasize that the results of the study and any information that they provide to
your team will be kept confidential.
Students should not consider financial services companies such as banks, insurance, or leasing companies as we
will not be discussing how to deal with these types of firms. Furthermore, it is recommended that students not
select airlines due to the extensive use of equipment leasing, which create challenges not adequately addressed in
the course.
If students choose to evaluate a recent transaction, they must address the key elements of the acquisition as
outlined below as if the transaction had not taken place. However, based on their analysis, they must be able to
answer the question of whether the acquiring firm overpaid, underpaid, or paid “fair market value” for the target
firm and why. This may require that the Team undertake several activities or evaluate options that may not have
actually been undertaken by the acquiring company. In this instance, the Team must determine and justify what
it considers to be appropriate terms and conditions for the transaction. Alternatively, the Team must vigorously
justify the actual terms and conditions of the transaction.
Students are encouraged to consult with the Professor about selecting a “Target” company early in the selection
process if there are questions about the appropriateness of a potential Target. The Professor will have final
approval of the companies to be used in the Acquisition Project.
In the past, students have developed business plans for their own companies (both public and private) and for a
business they were planning to start. The latter option represents an excellent opportunity to get input from both
the Professor and other students.
Each acquisition team is encouraged to develop mission statements, strategies and action plans that are different
from what the selected company may be saying publicly if the team feels that this is appropriate.
The Acquisition Team Project will be completed by each team submitting both the Word documents and Excel
spreadsheets to the Professor in both hard copy form and on a CD ROM. The cover page should indicate the
team members and the section(s) each member was responsible for completing, e.g., Julie Chang completed the
financial statements for the acquiring and target companies, David Martino and Leslie Van Houton were
responsible for developing the business strategy, etc.
Acquisition Team Project Business and Acquisition Plans: Each team will submit a business plan, which
includes an acquisition plan, not to exceed 50 pages including supporting financial tables. The acquirer’s
business plan should include the following elements:
Introduction
1. Executive Summary: In 1-2 pages, describe key objectives, why an acquisition is preferable to alternative
options such as a “go it alone” venture or alliance, why the recommended target is more attractive than other
potential target firms, the amount and composition of the initial offer price, how it will be financed, and key
risks associated with the transaction.
Business Plan (for acquiring firm)
1. Industry/market definition: Define the industry/market in which the target firm competes in
terms of size, growth rate, product offering, and other pertinent characteristics.
2. External analysis: Describe how the interaction and relative bargaining power of customers, competitors,
potential entrants, product/service substitutes, and suppliers determine industry cash flow and profitability.
Profile the industry/market using the “modified Porter framework” discussed in Chapter 4 (Figure 4-3) in
DePamphilis (pp. 130-145).
3. Internal analysis: Describe the acquiring company’s strengths and weaknesses and how they compare to the
competition.
4. Opportunities/threats: Discuss major opportunities and threats that exist because of the industry’s
competitive dynamics. Be sure that you can show how these threats or opportunities are a consequence of
the factors described in (2).
4
5.
6.
7.
8.
9.
Business mission/vision statement: Describe what industry/market needs are to be satisfied, who the
targeted customers are, and what resources or capabilities will be used to satisfy these targeted customer
needs.
Quantified strategic objectives (including completion dates): Indicate both financial (e.g., rates of return,
sales, cash flow, share price, etc.) and non-financial (e.g., market share, being perceived by customers or
investors as number one in the targeted market in terms of market share, product quality, price, innovation,
etc.) goals.
Business strategy: Identify how the mission and objectives will be achieved (e.g. become a cost leader,
adopt a differentiation strategy, or focus on a specific market segment).
Implementation strategy: From a range of reasonable options (“go it alone” strategy, partner via a joint
venture or less formal business alliance, license, minority investment, and acquisition), indicate which
option would enable the acquiring firm to best implement its chosen business strategy. Because of the
nature of the course, you must indicate that an implementation strategy involving an acquisition is preferred
to the other options and why.
Acquirer’s business plan valuation: Provide projected five year “standalone” income, balance sheet, and
cash flow statements for the acquiring company and estimate the firm’s value based on the acquirer’s
projected cash flows. State key forecast assumptions underlying the projected financials and the valuation.
Acquisition Plan (developed by acquiring firm)
1. Plan objectives: Identify the specific purpose of the acquisition. This should include what specific goals are
to be achieved (e.g., cost reduction, access to new customers, distribution channels or proprietary
technology, expanded production capacity, etc.) and how the achievement of these goals will better enable
the acquiring firm to implement its business strategy (see (7) above).
2. Timetable: Establish a timetable for completing the acquisition including integration if the target firm is to
be merged with the acquiring firm’s operations. Identify key activities that need to be accomplished and
indicate the estimated time required to complete activities. Also, estimate resources (i.e., people, money,
licenses, etc.) needed to complete each activity.
3. Resource/capability evaluation: Evaluate the acquirer’s financial and managerial capability to complete an
acquisition. Identify affordability limits in terms of the maximum amount the acquirer should pay for an
acquisition. Explain how this figure is determined by considering the impact on the acquirer’s EPS, cash
position, or level of indebtedness relative to its industry average.
4. Management preferences: Indicate the acquirer’s preferences for a “friendly” acquisition, controlling
interest, using stock, debt, cash, or some combination, etc.
5. Search plan: Develop screening criteria for identifying potential target firms and explain plans for
conducting the search, why the target ultimately selected was chosen, and how you will make initial contact
with the target firm.
6. Negotiation strategy: Identify key buyer/seller issues. Recommend a deal structure that addresses the
primary needs of all parties involved. Comment on the major elements of the deal structure including the
proposed acquisition vehicle, post-closing organization, form of payment, form of acquisition, and tax
structure. Explain the justification for the approach your team adopted in dealing with each aspect of the
deal structure (e.g., why was a particular tax strategy selected). Indicate how you might “close the gap”
between the seller’s price expectations and the offer price.
7. Purchase (offer) price estimate: Provide projected five-year income, balance sheet, and cash flow statements
for the target firm and for the consolidated acquirer and target firms. Develop a preliminary minimum and
maximum purchase price range for the target. Specify potential sources of and destroyers of value. List key
forecast assumptions. Identify an initial offer price, the composition (i.e., cash, stock, debt, or some
combination) of the offer price, and why you believe this price is appropriate in terms of meeting the
primary needs of both target and acquirer shareholders. The appropriateness of the offer price should reflect
your preliminary thinking about the deal structure.
8. Financing plan: Using the combined/consolidated financial statements, determine if the proposed offer price
can be financed without endangering the combined firm’s credit worthiness or seriously eroding near-term
profitability and cash flow.
9. Integration plan: Identify potential integration challenges and possible solutions. (For those teams
characterizing themselves as financial buyers, an integration plan may not apply. Instead, they should
identify an “exit” strategy.) For an actual transaction, teams must assess whether the acquirer overpaid,
underpaid, or paid fair value for the target firm.
5
Note that an Microsoft Excel-based spreadsheet model is available on the CDROM accompanying the textbook.
Students may use the model for completing the acquisition project, modify it to reflect the unique characteristics
of their situation, or develop their own model.
Acquisition Team Project Assessment
The total possible point score of 250 points for the project will be apportioned as follows:



33% for completeness: How well did the team address each point on the syllabus outline for the Acquisition
Team Project?
33% for quality of application: Did the team apply correctly tools and concepts learned in this course? (Hint:
Each team member should apply a number of different tools and concepts in each section for which they are
responsible.)
33% on creativity: Did the team specify clearly the acquirer’s and target’s objectives/needs? Deal the
address common deal structuring questions? Were they successful in meeting the highest priority needs of
both parties? Was the proposed deal structure realistic.
Each team member will receive the project’s total score adjusted for the professor’s evaluation of the section(s)
for which they are responsible. For example, while a paper may receive 250 points, individual team members
may receive 105% (i.e., 210 points) or 95% (i.e., 190 points) of the project’s total score.
Team Member Peer Review: Each team member will be asked to anonymously evaluate their team members
by assigning a letter grade to their overall contribution to the team paper. The student’s overall grade will be
calculated by a simple average of the grades assigned by their team members, with A=25, B=20, C=15, D=10,
and F=0.
Project Leader Peer Review: Each team member will also be asked to evaluate anonymously their project
leader’s performance, with A = 20, B = 15, C = 10, and D = 5, and F = 0. The project leader should be evaluated
in terms of their leadership in scheduling meetings, setting meeting agendas, facilitating meetings, motivating
others to satisfy their commitments, and overall quality control. Quality control refers to effort expended to
ensure that all portions of the final document have been completed and that the document reads as if it written by
a single individual.
Assignments: Answers to assignments, other than problem sets, should be typed. Answers to each question
should be double-spaced and not exceed one page in length. Submissions that are not typed will automatically
lose one-half of the total potential point score. Answers to problem sets should be legible.
Class Schedule
Week
August 29
September 5
September 12
Subject
1. Defining expectations
2. Course overview
3. Introduction to M&A
A. What is the success
rate?
B. Why do they occur?
C. What are the key
characteristics of
mergers & acquisitions
that meet expectations?
D. Future of M&A
Activity
4. Discuss P&G’s purchase of
Gillette
5. Discuss forming teams
Labor Day (University Holiday)
1. Common Takeover Tactics
and Defenses
Class Preparation
Copies of the syllabus are available on Blackboard.
PowerPoint presentations of the lecture notes for each
class will be available on Blackboard. Students are
encouraged to bring a copy of the appropriate lecture
notes to each class and to utilize the Student Study
Guide contained on the CDROM accompanying the
textbook.
Required Reading: Chapters 1 and 3 in DePamphilis and
lecture notes entitled “Common Takeover Tactics and
6
2.
3.
September 19
1.
2.
Discuss Alcoa/Reynolds
Case Study
Class time will also be
used to allow students to
begin to form teams
Acquisition Process:
Developing Business and
Acquisition Plans
Discuss Case Study
Illustrating the Free Market
Process of Creative
Destruction
Defenses.” Read Case Study 3-1 in DePamphilis
entitled “Alcoa Easily Overwhelms Reynold’s Takeover
Defenses” (pp. 94-95) and be prepared to discuss in
class. Note that there is no need to submit written
answers to the case study questions. Individual students
will be asked to lead discussion of specific questions in
front of the class.
Estimated time to complete reading: 4 hours.
Required reading: Chapter 4 in DePamphilis and
lecture notes entitled “Acquisition Process Phases 1 &
2. Be sure to read Case Study entitled “Illustrating the
Free Market Process of Creative Destruction:
Consolidation in the Telecommunications Industry
found on Blackboard and be prepared to discuss
questions 1-5 in class. Note that there is no need to
submit written answers to the case study questions.
Individual students will be asked to lead discussion of
specific questions in front of the class.
Estimated time to complete reading: 5 hours
September 26
1.
2.
October 3
1.
2.
Acquisition Process: Search
through Closing
Discuss McKesson HBOC
case study.
Define valuation cash flow
Discounted Cash Flow
Valuation Methodologies
a. Zero growth
b. Constant growth
c. Variable growth
By this date, students are to have organized themselves
into teams of four to five students each. Teams will
submit a listing of all team members, including names
and email addresses, to the professor. Teams will also
be expected to appoint a project leader. The project
leader’s responsibilities include scheduling team
meetings and developing meeting agendas, motivating
team members to meet their commitments, and for
“quality control.” The project leader will have the
potential to receive as many as 20 additional points
based on a peer review by other team members.
Required Reading: Chapters 5 and 6 in DePamphilis and
lecture notes entitled “Acquisition Notes Phases 3-10.”
Be sure to read Case Study 5-2 in DePamphilis entitled
“McKesson HBOC Restates Revenue” (pp. 189-190)
and be prepared to discuss in class. Note that there is no
need to submit written answers to the case study
questions. Individual students will be asked to discuss
specific questions in front of the class.
Estimated time to complete reading: 5 hours
Required reading: Chapter 7 (pp. 255- 279) in
DePamphilis as well as lecture notes entitled
“Discounted Cash Flow Valuation.”
Estimated time to complete reading: 4 hours
Optional Reading: Case study entitled “Valuation
Methods Employed in Investment Banking Fairness
Opinion Letters” found on Blackboard
Each Acquisition Team will provide the Professor with
the name of their team’s acquiring company and
acquisition target, LBO candidate, etc., and 2-3 page
project plan. The project plan should include key
objectives (i.e., why the acquiring company wants to
7
October 10
1.
2.
3.
4.
5.
Relative Valuation
Methodologies
Valuing non-operating
assets and liabilities
Adjusting the firm’s equity
value for non-operating
assets and liabilities
Discuss Problem Set
Discuss expectations for
first examination.
October 17
First Examination
October 24
1.
2.
October 31
1.
2.
Review exam results.
Introduction to M&A model
building process
a. Calculating EPS &
post-merger share price
for stock for stock, all
cash, and cash for stock
transactions.
b. Model adjustment
mechanisms
Analyzing Privately Held
Companies
Discuss Gee Whiz Media
Business Case
acquire the target firm), key activities that must be
completed to meet the project deadline, completion
dates for each activity, and the individuals(s)
responsible for completing each activity.
Required Reading: Chapter 7 (pp. 279-299) in
DePamphilis as well as lecture notes entitled “Relative
Valuation Methodologies.”
Problem Set: Answer practice problems 7.11,
7.12, 7.15, 7.16 – 7.19, 7.21, 7.24 and 7.25. Each
student must show all work to receive full credit. Each
student should bring two copies of their assignment, one
to submit for credit and another for taking notes as we
discuss solutions to the problems in class.
Estimated time to complete reading: 3 hours
Estimated time to complete Problem Set: 3 hours
Review Chapters 1 and 3-7 in DePamphilis, as well as
class notes, homework assignments, and Student Study
Guide on CD ROM accompanying textbook.
Calculators required.
Required Reading: Chapters 8 DePamphilis and lecture
notes entitled “Applying Financial Modeling
Techniques to Mergers and Acquisitions.” Students
should also review the Excel spreadsheet formulae
contained on the CD ROM in the back of the textbook
and read “Forecasting Business Performance” found on
Blackboard.
Estimated time to complete reading: 5 hours.
Required Reading: Chapter 9 in DePamphilis and
lecture notes entitled “Analyzing Private Companies.”
Read Chapter 14 in DePamphilis (Gee Whiz Media
Business Case). Be prepared to discuss questions 5, 13,
15, 21, and 29 in class. Individual students will be asked
to lead discussion of selected questions in front of the
class. There is no need to submit written answers to
these questions to the professor.
Estimated time to complete reading: 6 hours
November 7
1.
2.
Deal Structuring Process:
Form of Payment,
Acquisition Vehicle, and
Post Acquisition
Organization
Discuss Case Study
questions in class.
Work on Acquisition Team Project. By this time, it is
recommended that students should have completed
Sections 1-5 of the Business Plan portion of the
Acquisition Project. There is no need to submit these
sections at this time.
Required Reading: Chapter 10 (pp. 379-402) in
DePamphilis and lecture notes entitled “Deal
Structuring.” Also, read Case Study 10-1 in
DePamphilis (pp. 385-386) entitled “ News Corp’s
Power Play in Satellite Broadcasting“ and be prepared
to answer all case study questions in class. Note that
there is no need for students to submit written answers
to the case study question.
Estimated time to complete reading: 4 hours
8
November 14
1.
2.
3.
November 21
1.
2.
3.
November 28
December 5
1.
2.
3.
4.
2.
5.
December 12
Final exam
Deal Structuring Cont’d.:
Tax and Accounting
Treatment
Discuss Case Study
One-half hour of in-class
time devoted to acquisition
team meetings
Work on Acquisition Team Project: By this time, teams
should have completed Sections 6-9 of the Business
Plan for the Acquisition Project. There is no need to
submit these sections to the professor.
Required Reading: Chapter 10 (pp. 402-415) in
DePamphilis and lecture notes on tax and accounting
treatment. Also read Case Study 10-3 (pp. 416-417)
entitled “Vivendi and GE Combine Entertainment
Assets” and be prepared to discuss questions 1-5 in
class. Students will be selected to lead the discussion in
class for individual questions.
Analyzing and Structuring
Leveraged Buyouts
Discuss case study
questions
One-half hour of in-class
time devoted to acquisition
team meetings
Estimated time to complete reading: 4 hours
Work on Acquisition Team Project
Required Reading: Chapter 11 (pp. 425 - 446) in
DePamphilis. Also, read lecture notes entitled
“Leveraged Buyouts” (pp. 1-11) and business case study
entitled “Financing LBOs: The SunGard Transaction”
found on Blackboard and be prepared to discuss
questions 1-5 in class. Students will be selected to lead
the discussion in class for individual questions.
Valuing LBOs
Discuss case study questions
One-half hour of in-class
time devoted to acquisition
team meetings
Time required to complete reading: 5 hours
Work on Acquisition Team Project
Required Reading: Chapter 11 (pp. 446 - 462) in
DePamphilis and lecture notes on Blackboard entitled
“Leveraged Buyouts” (pp. 12-29).” Also, read Case
Study 11-2 in DePamphilis (pp. 441-442) entitled “Sony
Buys MGM” and be prepared to discuss the case study
questions in class. Students will be selected to lead the
discussion in class for individual questions.
Alternative Exit and
Restructuring Strategies
Discuss USX business case
Peer review of team
members and project
manager
Time Required to complete reading: 4 hours
Work on Acquisition Team Project
Required Reading: Chapter 13 in DePamphilis and
lecture notes entitled “Alternative Restructuring
Strategies.” Be sure to read Case Study 13-6 (pp. 524525) in DePamphilis entitled “USX Bows to
Shareholder Pressure” and be prepared to discuss case
study questions in class. Individual students will be
selected to lead discussion of specific questions in front
of the class.
Final Exam
Time required to complete reading: 4 hours.
Acquisition Team Projects due. None will be
accepted after this date.
Review Chapters 8 – 11 and 13 in DePamphilis, Student
Study Guide, and class notes since mid-term.
Calculators are required.
9