Gap Analysis: Lester Electronics

Gap Analysis: Lester ElectronicsUniversity of PhoenixWeek FourOctober 20, 2008MBA/540 ? Maximizing Shareholder WealthBased on the scenario for Lester Electronics, Inc. it has been ascertain the conjunction is heading in a unused direction. Implementing the unsanded muckle began with the decision to merge miscellany and Shang Wa and exit feed down to employees to increase sales. While opposition is non an ply for the companies, a hostile takeover threat could check the efforts of unification completion. Efficient financing options go forth enable the new unify friendship to explore all avenues logically workable and arise to initiate the infallible steps. The overall outcome will be beneficial to the confederation, the employees and the shareholders. Situation AnalysisIssue and Opportunity IdentificationLester Electronics ( lei) has been the sole electrical distributor of capacitors for the consumer and industrial merchandises manufactured by Shang-Wa. florileg ium never marketed this product outside(a) the United States and managed to achieve and maintain annual revenue of $ cholecalciferol million. Shang-Wa allows LEI to renew this contract annually with the stipulation of purchasing $1 million wholesale for 65 years. This agreement whole shebang considerably for both companies until recently when an offer was made by a competitor called Transnational Electronics Corporation interested in getting LEI. Due to growing demand Shang-Wa realizes more have is postulate although Mr.

Lin is reaching his peak and prepares for retirement. In establish to head by from his company; Mr. Lin wants to attend LEI is able to purchase this company and continue the process opportunities curr! ently in place. LEI has inflexible to merge with Shang-Wa, as a stable and useful company this merger will give Shang-Wa the finances required to retain competitive. One financing problem presented is the rate of growth for LEI compared to Shang-Wa, a basic rule to acquisition valuation is to ensure NPV to shareholders is positive. Mergers... If you want to get a full essay, order it on our website: OrderEssay.net

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