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All Synopsis Latest Draft - Imperial Tobacco by Nicholas...

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Imperial Tobacco by Nicholas Belcher Like Lester Electronics, Imperial Tobacco was facing an issue of trying to meet growing demand. “Imperial Tobacco is the world’s fourth largest international tobacco company, which manufactures, markets and sells a comprehensive range of cigarettes, tobaccos, rolling papers and tubes” (Group at a Glance, 2008). In order to achieve this type of growth, Imperial Tobacco had to acquire Altadis. Imperial Tobacco had high expectations from this acquisition. “Imperial Tobacco expects to achieve the substantial operational efficiencies, plus revenue benefits and a return of investment more than weighted average cost of capital by second full year of ownership. The WACC is compared to the internal rate of return on the project and determines profitability and the merit of the project and the consequent investment decision (Karpova, 2003). The acquisition was supposed to be completed by September of 2007, but delays occurred when the European Commission wanted several tobacco products removed from the market. Imperial Tobacco responded to this issue by conceding to the European Commission. Several products were removed from the market. The “deal is expected to be finalized by January 2008 after approvals were received from the Securities and Exchange Commission of Spain and from the European Commission” (Imperial acquisition of Altadis progresses, 2007). Imperial Tobacco also had to weigh several risk factors before they could acquire Altadis. These risk factors included: a declining demand for tobacco products, increased regulation of the tobacco industry, litigation cost, and international sanctions (Risk Factors, 2008). As a result of Imperial Tobacco’s efforts, “Acceptances in respect of approximately 95.81% of the Altadis shares were received. The 80% minimum acceptance condition has been
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satisfied and the Offer has become unconditional” (Imperial Tobacco Group PLC Announces the Final Result of its Offer for Altadis, S.A., 2008). Lester Electronics will be hoping to have a track record like Imperial Tobacco of gaining quick returns on their investments that are higher than the weighted cost of capital. A statement on Imperial Tobacco’s web site acknowledges this track record. “We have a successful track record of integrating our acquisitions and rapidly generating returns. We shall continue to seek and execute further acquisitions which meet our established strategic and financial criteria” (Acquisitions, 2008). 3M Co. Synopsis by Nicholas Belcher Like Lester Electronics, 3M was facing an issue of trying to invest for its future growth and to protect its shareholders. 3M Co. is considered as one of the most leading multinational companies in the world and is ranked among the top 10 U.S. Companies in patents granted. In order to achieve this type of growth and satisfy shareholders, 3M Co. had to develop a Dividend Payout Policy. This worked for many years, but 3M ran into some issues in 1991. “But for all
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This note was uploaded on 06/27/2008 for the course HR 501 taught by Professor Bob during the Spring '08 term at Adams State University.

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All Synopsis Latest Draft - Imperial Tobacco by Nicholas...

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