Bob and Jane now with 5 children flourished in the Houston community, both becoming heavily involved in giving of their time and influence to issues close to their hearts.
Porter, understandably, is open to this idea since Cooper stocks will be given to him in a far more liquid form than his VLN stocks, allowing a greater return on his investment.
The onset of World War II and the rapid build-up of the defense industry in New England provided the family an opportunity to escape the coal fields of Scranton for a new life in Norwalk, Connecticut.
On April 3, Nicholson reached an agreement on a merger with VLN Corporation, a company primarily focused on automotive equipment. Jane and their first child joined him there some eight months later.
Cizik only needed the support of at least 86, of the unaccounted for shares. If he did go through with the merger, he wanted to be sure it was a fair merger that maintained the support of Nicholson management and shareholders.
Cooper should issue debt to fill in the gap.
Analysis for scenario 1: The first and most obvious option before Cooper Industries is to move forward with acquiring further shares, through the Porter Company, to acquire control of Nicholson.
The Exhibit 2 shows the valuation of Nicholson if it operates as a part of Cooper Industries. The reason why Nicholson is trading at a premium over its net present valuation of discounted cash flows is because of the looming acquisition, and the synergies it will create.
Cooper, upon hearing the news, offered to help Nicholson. This gives the values of: This would seem to be the most beneficial arrangement for all parties concerned with the exception of VLN. Overall, the company currently have Initially joining Standard Oil Company in New York City Exxonhe soon learned of an opportunity at Cooper Industries formerly Cooper-Bessemera manufacturer of engines, turbines and compressors for the oil and natural gas industry.
The analysis is as follows. Analysis for scenario 2: We have three proposed suggestions: Summary of the Problem Cooper Industries was founded in as an equipment and heavy machinery manufacturer.
Adopting the work values passed on by his parents and grandparents, Bob graduated with high honors from the University of Connecticut in Management of Nicholson Company sought to merger with VLN that would ensure continuity of Nicholson management and operating independence.
We calculated the historical price-earning ratio, which is the average from to They would give cash to shareholders and helps to convincing the shareholders to accept the deal because the management can influence the shareholders. Nicholson has an offer on the table for continued operations and leadership independence and a chance for preferred VLN stock in exchange for a Nicholson share.
Porter feared that they would be stuck with VLN preferred stock that paid low dividends and did not show potential for growth. As first-generation Americans of Eastern European heritage, his parents taught their sons old world work values in a new world where they believed every man could realize his dreams through hard work.
However, under current term with VLN, one share of new VLN cumulative convertible preferred stock would be exchanged for each share of Nicholson common stock.
If you were Mr. His father was a miner who worked in the coal fields near Scranton, Pennsylvania. Anna worked in the local silk mills when John was out of work, a not infrequent occurrence during the Great Depression.
Estimation of Cost of Debt: The stock price and value of both companies will rise. This was a much more attractive alternative, since people can anticipate that earnings would increase next year and the price of Cooper would show significant price appreciation. Cooper Industries continued to be interested in the opportunities that Nicholson would afford them in terms of stable earnings and sophisticated distribution systems.
Porter was only able to acquireshares of Nicholson, which did not constitute a majority, and its slate of directors was defeated by Nicholson management. Porter knew that a Cooper-Nicholson merger would allow him to convert his Nicholson shares to common stock or preferred stock.
Upon returning from military duty, Bob entered Harvard Business School and graduated with High Distinction in where he was also named a Baker Scholar. Cooper is also offering to keep the management of Nicholson in place.Cooper Industries Teaching Note (1) Explore.
Explore Scribd Bestsellers. Explore by Interests. If you were Mr. Cizik of Cooper Industries, would you try to acquire Nicholson File Company in May ? Why? What should Mr.
Cizik recommend that the Cooper management do? Assignment- Complete TN1 for our next class and answer questions 1. Group Case Analysis: Cooper Industries, Inc. Essay Sample.
Mr. Cizik of Cooper Industries was then faced with the difficult decision to move forward for control of Nicholson. Mr. If you were Mr. Cizik of Cooper Industries, would you try to gain control of Nicholson File. If you were Mr. Cizik of Cooper Industries, would you try to gain control of Nicholson File Company in May ?
2. What is the maximum price that Cooper can afford to pay for Nicholson. Answer to If you were Mr. Cizik of Cooper Industries, would you try to gain control of Nicholson File Co.
Robert Cizik is the executive vice president of. View Notes - cooper from MBA fin at Heidelberg University. Analysis of Cooper Industries, Inc. 1. If you were Mr. Cizik of Cooper Industries, would you try to gain control of Nicholson File Company96%(27).
Based off our research we believe Mr. Cizik of Cooper Industries should try and gain control of Nicholson File Company. Below we will show why we believe this is a smart acquisition. The reason Cooper should work to acquire is the vast amounts of synergy that will be acquired by merging companies.Download