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Case
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Reference no. UVA-F-1331
Subject category: Finance, Accounting and Control
Authors: Bob Bruner (Darden School of Business, University of Virginia); J Chadwick Rynbrandt (Darden School of Business, University of Virginia); Sean Carr (Darden School of Business, University of Virginia)
Published by: Darden Business Publishing
Originally published in: 2001
Version: 12 February 2014
Revision date: 15-Apr-2014
Length: 20 pages
Data source: Published sources
Topics: Private equity; Valuation; Discounted cash flow; Multiples; Leverage; Finance; Corporate finance; Financial strategy; International finance
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Abstract

In February 2000, a managing partner of a UK-based private equity fund, Palamon Capital Partners, faced the decision of whether to invest in an Italian software company, TeamSystem, SpA. The rationale for this investment was a belief in the rapid future consolidation of the enterprise software industry in Italy, in combination with improvements in operating performance believed to arise from a stronger investor orientation after the transaction. The transaction entailed a leveraged recapitalization of the target that would significantly change its ownership, control and leverage. The task for the student is to evaluate the attractiveness of the investment, based on a strategic appraisal, a valuation of the target with its new capitalization, and an assessment of the proposed deal structure.
Industry:
Banking, finance, insurance
Teaching note
-
Reference no. UVA-F-1331TN
Subject category: Finance, Accounting and Control
Authors: Bob Bruner (Darden School of Business, University of Virginia); C Rynbrandt (University of Virginia)
Published by: Darden Business Publishing
Originally published in: 2001
Version: 12 February 2014
Revision date: 17-Apr-2014
Length: 20 pages
Data source: Published sources
View full details

About

Abstract

In February 2000, a managing partner of a UK-based private equity fund, Palamon Capital Partners, faced the decision of whether to invest in an Italian software company, TeamSystem, SpA. The rationale for this investment was a belief in the rapid future consolidation of the enterprise software industry in Italy, in combination with improvements in operating performance believed to arise from a stronger investor orientation after the transaction. The transaction entailed a leveraged recapitalization of the target that would significantly change its ownership, control and leverage. The task for the student is to evaluate the attractiveness of the investment, based on a strategic appraisal, a valuation of the target with its new capitalization, and an assessment of the proposed deal structure.

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Industry:
Banking, finance, insurance

Related

Teaching note
-
Reference no. UVA-F-1331TN
Subject category: Finance, Accounting and Control
Authors: Bob Bruner (Darden School of Business, University of Virginia); C Rynbrandt (University of Virginia)
Published by: Darden Business Publishing
Originally published in: 2001
Version: 12 February 2014
Revision date: 17-Apr-2014
Length: 20 pages
Data source: Published sources
View full details