Corporate Finance 15

Corporate Finance 15 - 37.7 12.1 4 99.9 22.3 72.6 41.9 24.7...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
UGG Monday, December 06, 2010 8:05 AM Issue: Alt-man made offer for $13.75/share UGG hired us to deal with hostile takeover offer (Scotia Capital Markets) Choices Take Turn down it completely Turn down conditionally /Negotiate Criteria Shareholder wealth Risk Scotia's reputation Structure Farmer owned Sizeup Economy Industry Internal Financial Management Board is stacked toward farmers 12/15 Marketing Etc Total equity value is 175 mil Net debt 160mil Market value= total asset value=336 mil Premium Paid Implied UGG price 1-Day 1 wk 4 wk C-Malt 14.35 14.80 11 Multiples TEV/LTMREV TEV/Forecasted EBITDA BC Sugar .59*1956(UGG LTREV)-163(net debt)-21(preferred equity)=972/12.5=$77 6.53*46.2-163- 21=117.686/12.5=9.4 WACC Wd=35% We=65% Kd=7.45% T=46% Ke=rv+BMP=6.2+1*6.5=12.7% WACC=9.7%
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
EBITDA -DA EBIT EBIT (1-T) +DA -CAPEX -ING wk FCF 1 58.3 19.6 34.7 21.4 -26.5 2 74 21.5 52.4 28.3 -1.8 3 91.9 22.1 69.9
Background image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: 37.7 12.1 4 99.9 22.3 72.6 41.9 24.7 5 104.6 22.3 82.3 44.4 33 [33(1+g)]/(9.71-g)=606.8 (terminal value) where g=4% PV at i=9.75 PV=404 or total asset value-Debt and Preferred= -(161+21)=/183 =221 =$17.76/share Synergies EBITDA One Time Costs Tot Syn B4 Tax After tax TV PV After Factors(higher for alta-man 1 18.6-16.5 3.1 1.7 2 37.3-15.5 21.8 11.9 3 56 56 30.2 4 57.1 57.1 30.8 5 58.3 58.3 31 418.8 339 339(1-50%)(1-50%)=84.7 Results Alta-man withdraw after rights kicking which occurred when alta-man got 21% (6.# with other investors) went down to 2% (ideally) Alta-man hold current stake (15%) Oppehheimer attempts "rebellion" ADM require 42% @$16.share Alberta and Manitoba become agricore coop Ugg and agricore later merge Public 55% agricore UGG stock price= $12.25...
View Full Document

Page1 / 2

Corporate Finance 15 - 37.7 12.1 4 99.9 22.3 72.6 41.9 24.7...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online