Lester Electronics_Generic_Benchmarking_team_D

Lester Electronics_Generic_Benchmarking_team_D - Lester...

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Lester Electronics: Generic Benchmarking Paper 1 Running head: Lester Electronics, Inc: Generic Benchmarking Paper Lester Electronics, Inc.: Generic Benchmarking Paper University of Phoenix MBA 540
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Lester Electronics: Generic Benchmarking Paper 2 Lester Electronics: Generic Benchmarking Paper
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Lester Electronics: Generic Benchmarking Paper 3 Introduction Companies can increase their value through investment in growth opportunities (internal and external), sound management of working capital, and the careful allocation of resources across a portfolio of projects and activities that are most likely to deliver the expected returns at the desired level of risk (Ross et al, 2004). This paper examines the efforts of ten companies to measure and increase value and which might offer a solution for Lester Electronics, Inc. Situation Background Lester Electronics (LEI) is a publicly traded company that has been around since the 1920's and whose revenue is approximate $500 million per year. The Owner and CEO Bernard Lester has become very good friends with the owner of their exclusive supply company, Shang-Wa. The scenario describes that Shang-Wa has been approached by Transnational Electronics (TEC) to purchase them however; this could result in a hostile takeover. The result of such a decision would be a 43% reduction in revenues for LEI over the next five years. LEI has also been approached by an organization, Avral Electronics, which throws another problem into the mix. Lester Electronics (Lester) finds itself faced with a difficult decision after years of profitability and growth due in large part to its long-term relationship with Shang-wa (University of Phoenix, n.d.). Threatened with the loss of its exclusive distributorship of Shang-wa capacitors, it must decide whether to recommend a joint development with Shang-wa, the acquisition of or merger with Shang-wa, or a takeover by Avral Electronics, S.A. LEI and Shang-Wa must make a rapid decision regarding their partnership and what the future holds for them. Each company must also consider how their organization could benefit from an outside organization and keep the friendship out of the decision making process. Evaluate internal and external growth strategies Describe working capital management strategies to maximize shareholder wealth Capital management strategies are mathematical calculations that are developed to determine methods to better control funds within a company to increase the amount of money that a company incurs. Victory Capital Management (Victory) streamlined its business plan by re-
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This note was uploaded on 03/28/2008 for the course MBA 530 taught by Professor Whoknows during the Spring '08 term at University of Phoenix.

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Lester Electronics_Generic_Benchmarking_team_D - Lester...

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