Project requirements
Pick a target company that you as a company like to merge with. (Mostly
the analysis on Target Company ) for example you are bank of America and you
want to buy (bank of Florida which this will be your target).
Locate a publicly traded company in an industry that interests
you. Find a publicly traded competitor
which is suitable for a merger or acquisition with this firm. Click here for more on this paper.......
Write a (10-15) pages double spaced paper (not including exhibits) on
why the company should be acquired and what purchase price should be paid. Your analysis should include the “real”
reasons behind the merger and not the standard answers. Major topics should include: A brief background of the industry which the
company operates, a background on the company and the management team, the
acquisition purchase price (you may want to include a base purchase price and
the maximum purchase price your firm would be willing to pay), what makes this
merger a good fit, a brief strategy on how the company will operate after the
merger, and how the deal would be financed.( the analysis should be for the
target company).
You have an enormous amount of material to use for this project. Annual Reports and 10Ks can be obtained by
contacting the company’s Investor Services Department.
Prepare your presentation as though it was before the Board of
Directors of the company. The class will
be asking specific questions about your analysis, so be prepared.
Try to stay away from Airlines Companies and banks, since it’s a bit hard
to analyze.
Describe how the target company fits does and operates within the
industry. (Important point)
Explain and show how you came up with the bid price and why.
Calculate NPV (Make sure it is right and it is not a negative number,
if so maybe you will have a problem with your working capital which is
calculated by account payable, account receivable, inventory) ( make sure
when you calculate your WC its
incremental not total) show what this number means and what it will do, also
IRR,,, and other important calculations.
Make sure your calculation (your model
and financial statements and right and cash flow forecasting), and focus on
your calculation when you do AccretiveDilutive.
Valuations and
recommendation, and show why you should confines people to invest in your idea
of merge.
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