With the data provided and the assumption made about the future of mercury athletic, i think that liedtke can make a valid case for agi acquiring the footwear company. Bus 172a investment analysis assignment 2016 00278253. The different scenarios include expected, good and worst. Bufn 750 valuation of corporate finance the mercury athletic footwear case report track 0504 professor liu. Mercury athletic footwear valuing the opportunity author case analysis mercury athletic footwear table of contents 1. The case uses the potential acquisition of mercury athletic as a vehicle to teach. Wcf, a large designer and marketer of mens and womens branded apparel had recently announced plans for a strategic reorganization. Mercury athletic footwear mercury athletic footwear designed and distributed branded athletic and casual footwear, principally to the youth market. There has been low growth, with stable profit margins. Mercury athletic footwear case study assignment help center. Joel l heilprin in january 2007, west coast fashions, inc. Return on net assets return on equity asset turnover. It is also the trading name of the case centre usa, a nonprofit making company. Valuing the opportunity case exhibits, spreadsheet supplement 4054xlseng 6.
Two main problems are continuing low growth rate because of serious competition of the mature footwear industry and rise of discount retailors, and pressure from. One of their segments was mercury athletic footwear. Average cost of capital, united states, footwear, athletic apparel, footwear. Exhibit 4 presents recent income statements and balance sheets for mercury. West coast fashions, inc a large business of mens and womens apparel decided todispose of one of their segments. Valuing the opportunity case solution, mercury athletic. The percent revenue in the casual footwear in agi compensates for the gap in mercury. Mercury athletic footwear acquisition analysis active gear cost of capital assumption tax rate cost of debt risk free rate expected market return market risk premium asset. Mercury athletic footwear case study john liedtke head of active gear, inc. Valuing the opportunity case analysis, mercury athletic. After refreshing your mind, read your case study solution critically. The competition has been competing to anticipate and exploit fashion trends.
Essay about mercury athletic footwear case 1280 words. Acquisition of mercury athletic linkedin slideshare. Mercury financial valuation case 2183 words 9 pages. They just wanted to divest because they wanted to focus more on their core business and move it up to the elite class. John liedtke, the head of business development for active gear, a midsized athletic and casual footwear company, saw the potential acquisition of mercury as a unique opportunity to roughly double the size of his business. Bus 172a investment analysis assignment 2016 sku 123312. An englishlanguage pdf of this brief case in an academic course pack will allow the students with the opportunity to buy an audio form as well.
Download as xlsx, pdf, txt or read online from scribd. Valuing the opportunity in march 2007, john liedtke, the head of business development for active gear, inc. The casual footwear industry is a mature, but highly competitive industry. When we are writing case study solution we often have details on our screen as well as in our head. Instead, it went through a decline in ebitda margin on average, resulting from the inappropriate expanding and discounting strategies. Mercury athletic footwear case study essay 780 words bartleby. Heilprin applies discounted cash flow analysis to the valuation of an acquisition candidate. There are numerous synergies which can be found in agi and mercury athletics. Excel solution to a mercury athletic case analysis. Synergies mercury athletic valuation liedkes projections womens casual division incorporating the loss from discontinuing the womens casual line display a higher degree of detail operating expense increase from 2006 to. Valuing the opportunity team 10 mergers and acquisitions west coast fashions, inc wcf was a large business, which dealt with mens and womens apparel. Harvard business school spreadsheet supplement 094056. The case centre is a notforprofit company limited by guarantee, registered in england no 1129396 and entered in the register of.
Essay about mercury athletic footwear 1737 words bartleby. Mercury features the most experienced leadership and operating management of anyone in the footwear sourcing business. Mercury athletic footwear was acquired by the west coast fashion in late 2003. Valuing the opportunity hbs case, exhibits exhibit 1 active gear, inc. Adam guerrero 4 march, 2015 problem statement mercury athletic is the footwear division of west coast fashions wcf, a designer and marketer of mens and womens apparel. Mercury athletic footwear case study research paper 767. Mercury athletic footwear case dcf valuation analysis jianqiu huang. Valuing the opportunity case solution estimation of the business under three different scenarios in this case, the analyst asked to draw three separate scenarios and to forecast the performance of the company. Valuing the opportunity hbs case, exhibits table 2 mercury operating metrics.
Goldman sachs case competition 1st place 2015 by bruin. John liedtke was the business development head at that time in active gear inc. The case centre is a notforprofit company limited by guarantee, registered in england no 1129396 and entered in the register of charities no 267516. Harvard business school case study completed for my intro to finance course final project. The industry is same, products are similar, markets are similar, greater ability to merge each others operating efficiencies and improve deficiencies, therefore it is evident that these factors confirm that mercury is. Mercury athletic footwear valuing the opportunity fins 3625 case study written component executive summary this report provides an analysis upon active gear incs agi acquisition merger with mercury athletic footwear, previously a subsidiary division of west coast fashions inc, and evaluates whether there is a valuable growth. Mercury athletic footwear valuing the opportunity term. Mercury background 2003 acquired by west coast fashions wcf attempted brand extension through apparel line business stalled mercury ceo eager to return exclusively to footwear four footwear product lines menswomens athletic menswomens casual 2006. Agi is a privately held footwear company and is contemplating the possibility of acquiring mercury athletic footwear. Executive summary great pressure from suppliers and competitors caused some deterioration of basic performance for agi during 20042006.
Encompassing both active gear and mercury athletic footwear. When students have the englishlanguage pdf of this brief case in a coursepack. Course syllabus valuation models and practices entpfin 6311. The strategic merit is that both companies mercury and agi, are footwear companies that attract the youth market.
When students have the englishlanguage pdf of this brief case in a coursepack, they will also have the option to purchase an audio version. May 06, 2016 mercury background 2003 acquired by west coast fashions wcf attempted brand extension through apparel line business stalled mercury ceo eager to return exclusively to footwear four footwear product lines menswomens athletic menswomens casual 2006. Valuing the opportunity case solution while considering whether or not mercury is an appropriate target for the active gear incorporated agi, different qualitative aspects need to be analyzed. Valuing the opportunity case solution,mercury athletic. Founded in 1968 by daniel fiore producer, designer and distributor of branded athletic and. Written component mercury athletic historical income. However, some potential synergies which can make a better cost and revenue structure after acquiring mercury include increased sales and production capacity, cost efficiency towards forwards channels, increased bargaining power. Valuing the opportunity teaching note exhibits, faculty spreadsheet supplement brief case. Valuing the opportunity at mercury athletic footwear. Bus 172a investment analysis assignment 2016 00278253 tutorials for question of finance and finance. Goldman sachs case competition 1st place 2015 by bruin asset. Mercury potential to double revenues increase leverage with manufacturers increase long run growth rate expand presence with key retailers and distributors.
Synergy, the increase in value that is generated by combining two entities to create a new and more valuable entity, is the magic ingredient that allows acquirers to pay billions of dollars in premiums in acquisitions. Valuing the opportunity terran knox measurements ii mba634 northwood university devos program dr. Valuing the opportunity case analysis, mercury athletic footwear. Mercury athletic footwear, inc valuing the opportunity. Aug 16, 2017 with the data provided and the assumption made about the future of mercury athletic, i think that liedtke can make a valid case for agi acquiring the footwear company. Valuing the opportunity case solution,mercury athletic footwear. Mercury athletic valuing the opportunity case solution and. The industry is same, products are similar, markets are similar, greater ability to merge each others operating efficiencies and improve deficiencies, therefore it is evident that these factors confirm that mercury is the best target for acquisition. Mercury athletic footwear by dylan marschall on prezi. John liedtke, the head of business development for active gear, a midsized athletic and casual footwear company, saw the potential acquisition of mercury as a unique. Mercury ceo eager to return exclusively to footwear four footwear.
Valuing the opportunity the case centre, for educators. Harvard business school spreadsheet supplement 094054. Mercury athletic goodwill accounting expense scribd. Mercury athletic footwear valuing the opportunity memo. Mercury athletic footwear case study 3866 words cram. Mercury looked like a good opportunity for an attractive investment because they almost have the same revenues, while being smaller in size, in the market.
The case uses the potential acquisition of mercury athletic as a vehicle to. We bring this fact up because it means youre partnering with experts who have seen it all, done it all and solved it all. Valuing the opportunity case solution, case analysis, case study solution. Wcf, a large designer and marketer of mens and womens. Mercury athletic dcf analysis discounted cash flow analysis. Mercury athletic footwear case study essay 780 words. Valuing the opportunity case study solution, when pupils have the english language pdf of this brief case in a coursepack, they are going to moreover have the option to obtain an audio version. Valuing the opportunity case exhibits, spreadsheet supplement brief case. Operating projections, enterprise and equity value, sensitivity analysis. Valuing the opportunity harvard business school case 4050, timothy a.
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