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Case
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Reference no. UVA-F-1466
Published by: Darden Business Publishing
Originally published in: 2005
Version: 1 February 2019
Revision date: 11-Feb-2019
Length: 12 pages
Data source: Published sources

Abstract

This case is a sequel to 'WLR Foods and Tyson Foods', which presents the attempted acquisition of WLR by Tyson Foods in 1994. Over the ensuing six years, WLR's stock price slid consistently downhill until 2000, when it was trading at a fraction of its 1994 value. When WLR's share price hit USD4.59, Pilgrim's Pride Corporation (PPC) viewed the company as an attractive acquisition. This case asks the student to determine how much of a premium PPC should offer and whether WLR management will resist a takeover in 2000 as it did in 1994. Financial information is provided to allow students to compute both stand-alone and with-synergies valuations. The case is best taught immediately following the prequel. It is designed to be taught as a firm-valuation exercise in a first-year or second-year MBA finance course. It is also suitable for executive and undergraduate audiences.
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Abstract

This case is a sequel to 'WLR Foods and Tyson Foods', which presents the attempted acquisition of WLR by Tyson Foods in 1994. Over the ensuing six years, WLR's stock price slid consistently downhill until 2000, when it was trading at a fraction of its 1994 value. When WLR's share price hit USD4.59, Pilgrim's Pride Corporation (PPC) viewed the company as an attractive acquisition. This case asks the student to determine how much of a premium PPC should offer and whether WLR management will resist a takeover in 2000 as it did in 1994. Financial information is provided to allow students to compute both stand-alone and with-synergies valuations. The case is best taught immediately following the prequel. It is designed to be taught as a firm-valuation exercise in a first-year or second-year MBA finance course. It is also suitable for executive and undergraduate audiences.

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