Subject category:
Finance, Accounting and Control
Published by:
Harvard Business Publishing
Version: 2 June 2003
Length: 2 pages
Data source: Generalised experience
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Abstract
Martin Smith, a new associate at an LBO firm, must react to a problem posed by his boss, based on an historical deal that suddenly came undone. After months of negotiation, his firm's plan to buy a bankrupt competitor of one of its portfolio companies and close it down, thus reducing capacity, was ready for board approval. Recently, not only has the market for the product turned up, but management of the target firm has presented a more attractive deal to recapitalize the company. This would have disastrous results for the entire industry by perpetuating an overcapacity problem. Discusses Smith suggestions.
Location:
Other setting(s):
2002
About
Abstract
Martin Smith, a new associate at an LBO firm, must react to a problem posed by his boss, based on an historical deal that suddenly came undone. After months of negotiation, his firm's plan to buy a bankrupt competitor of one of its portfolio companies and close it down, thus reducing capacity, was ready for board approval. Recently, not only has the market for the product turned up, but management of the target firm has presented a more attractive deal to recapitalize the company. This would have disastrous results for the entire industry by perpetuating an overcapacity problem. Discusses Smith suggestions.
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Location:
Other setting(s):
2002