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This technical note offers an example of a thoroughly complete "pitch book" for use as a basis of class discussion and learning. Actual pitch books are almost never made available for public use. This presentation, however, was prepared by a group of Darden students in April 2001 for a jury of M&A executives of United Technologies Corporation-they judged this work to be of excellent quality, among the best they had seen in any setting. A separate validation of the deal concept is given in the final exhibit, which records the ammouncement on July 30, 2001, by General Electric of its acquisition of Heller. In reviewing this document, the task for the student is to assess both its form and contents, from the standpoints of both the presenter and audience. Why is each exhibit and section included in the document? What analytical work underpins the exhibits? What might explain the presentation format? What oral comments might one make in supporting this presentation to a group of executives?

Provides a basic understanding of how securities markets work.

Business decisions based on poor valuation practices can create significant losses. Here's a straightforward set of calculations that will help your company assess the impact of its valuation decisions on shareholder returns.

Presents the solutions to questions 1 through 4 of the problem set. To be handed out in class. A rewritten version of an earlier supplement.

Jan Karl Karlsen is the CFO of The Far East Trading Company, a 100-year old Swedish company with operations throughout Asia and Latin America. It is November 1997, and the firm has just issued its second official profit warning to its stockholders in Stockholm, its corporate home. The company is now feeling the effects of the Asian currency crisis, which began in July 1997 in Thailand, and then spread to the neighboring countries of Indonesia, Malaysia, the Philippines, Taiwan, Singapore, and Korea. As Jan Karl Karlsen pondered what specific actions were needed to navigate the treacherous waters of the market crisis, he focused on the "three C's of corporate financial management; control, confidence, and cash flow."

Spreadsheet Supplement for case 202090.

The partners of a new midmarket buyout fund are working on a buyout of a closely held modular building company. Although originally structured as a stock deal, they have realized that an asset deal would be preferable from their point of view and are trying to determine what benefits it might hold for the sellers, whose continuing involvement in the company is essential for success. This case describes the process of the deal's due diligence and the state of the LBO industry in the early 21st century.

These two cases consider the capital investment decisions to be made by executives of this large chemicals firm in January 2001. The 'A' case presents a go/no-go project evaluation regarding improvements to a polypropylene production plant. The 'B' case reviews the same project but from one level higher, where the executive faces an either/or investment decision between two mutually exclusive projects. The objective of the two cases is to expose students to a wide range of capital-budgeting issues which include, among others, the identification of relevant cash flows, the critical assessment of a capital-investment evaluation system, the classic "cross-over" problem, in which project rankings disagree on the basis of net present value (NPV) and internal rate of return (IRR).

The purpose of this case is for the student to build and evaluate a cash flow analysis of an investment proposal in an IT project. A central issue is the determination of the relevant costs for the analysis. The case also allows for the estimation of cost of capital for the company, which is decidedly less than the hurdle rate dictated for the project. The case provides information about the capital budgeting approval process within the firm and how incentives may not be aligned with shareholders for certain decisions.

Discusses the recent history of the commercial real estate financial market (pre-1990s-2001). Looks at the shift to more conventional capital markets for commercial real estate debt.

In January 2001, the chief executive of this small yarn-production company in India must resolve a surprising cash shortage. The task for students is to evaluate the causes of the shortage (using a completed "base-case" forecast given in the case) and assess the usefulness of various possible remedies suggested by company managers. In essence, the company is unable to liquidate a seasonal working capital loan for the requisite 30 days each year. This difficulty arises from two classic causes: (1) secular growth of the company, and (2) declining profitability. Possible remedies include reducing inventory through more efficient transportation and warehousing, reducing credit terms to customers, having raw materials supplied on a just-in-time basis, switching from seasonal to level production, improving profitability, decreasing dividends, and reducing sales growth.

This case is based on an actual investment decision made by a major paper-products company, and is primarily designed to be a straightforward exercise in assessing cash flows, cost of capital, and net present value of a capital-investment decision. The case works well for all audiences who are learning the basics of discounted cash flow and investment analysis, including the estimation of relevant cash flows (both cost savings and increased revenues), the effect of taxes on cost savings and revenues, the change in net working capital as a cash flow, and the weighted average cost of capital as the discount rate for the average investment.

Spreadsheet for case UV2282

Select Collections sounds like the name of a fancy dress shop. Actually, in this case, it's a collection agency whose credit manager has asked a summer intern to apply her knowledge of regression analysis to forecast the amount the company will collect from 3,570 delinquent accounts. The intern must submit her forecasts in a contest with other interns to see whose model works the best. The case provides students with a modeling experience on a large data set. Instructors can form student teams and conduct their own forecasting contests.

Spreadsheet Supplement for case 202036

A small start-up in the publishing business compares three possible alternatives for its new round of equity financing.

Supplements the (A) case.