Subject category:
Strategy and General Management
Published by:
Ivey Publishing
Version: 2003-11-28
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Abstract
York River is a Canadian pulp and paper company whose major product is container material, used for making cardboard boxes. The company has three major customers. A small competitor has made a takeover bid for one of these customers. If successful, York will lose 25% of its volume. Should York make a $50 million counterbid to keep the customer? Assessment of the reaction of other customers relative to impending consolidation is critical.
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Abstract
York River is a Canadian pulp and paper company whose major product is container material, used for making cardboard boxes. The company has three major customers. A small competitor has made a takeover bid for one of these customers. If successful, York will lose 25% of its volume. Should York make a $50 million counterbid to keep the customer? Assessment of the reaction of other customers relative to impending consolidation is critical.