West Coast Fashions Inc., a large designer and marketer of men’s and women’s branded apparel recently announced that it plans to shed its Mercury Athletic Footwear subsidiary. Nike Inc. enjoys a top position in the global athletic shoes, equipment and apparel market. 12.5%. 5: The acquisition will help AGI expand to more retailers and distributors. Teaching note supplement software -Reference no. 1843 East Passyunk Avenue Philadelphia, PA 19148-2127 Phone: (267) 551-3464. analysis, building models in Excel, and writing. Read More Athletic footwear refers to those shoes that are designed for sports and other outdoor activities. Home >> Harvard Case Study Analysis Solutions >> Mercury Athletic Footwear. This is just a sample partial case solution. West Coast Fashions, Inc has decided to dispose off one of their segments, Mercury Athletic. Following formula is used to calculate the terminal value. West Coast Fashions, Inc. (WCF), a large designer and marketer of men’s and women’s branded apparel recently announced plans for a strategic reorganization. Excel University City. This decision is mainly driven by the fact that AGI is highly profitable, but its size is very small in comparison with other highly profitable companies. Our expert PhD qualified tutors have prepared these solutions. This effect can lead to decrease the overall manufacturing costs for AGI. 1: Overhead to revenue ratio will follow the historical trends. Opening Soon! Therefore,it was highly important that the firm should expand in proportion to its profitability. Mercury Athletic Footwear: Valuing the Opportunity Active Gear, Inc. (AGI) is a privately held footwear company and is contemplating the possibility of acquiring Mercury Athletic Footwear. Always be ready to take total benefit of the stream of ideas as soon as it starts to gush. It lowers the overall revenue and subsequently decreases the enterprise value for acquisition. Is Mercury an appropriate target for AGI? 100 out of 1000 Most relevant mercury athletic footwear case solution excel websites. Mercury Athletic Footwear. Mercury Athletic Footwear Case Study Essay 780 Words | 4 Pages. Executive Summary Great pressure from suppliers and competitors caused some deterioration of basic performance for AGI during 2004–2006. Mercury Athletic Footwear Case Study John Liedtke head of Active Gear, Inc. (AGI) is contemplating whether to invest in Mercury Athletic a subsidiary of West Coast Fashions (WCF). Mercury Soccer will be hosting tryouts from October 24 - November 7. Thus, the acquisition price comes out to be $186215. All rights reserved, '); $42,299mn. Mercury is specialized in designing and distributing the branded athletic and casual footwear. Software -Reference no. Add to Dashboard Remove Keyword Popularity . Mercury Athletic Footwear – Acquisition Analysis. This beta is used in the calculation of cost of equity afterwards. 2% to 6%. Mercury Athletic Footwear Case Study John Liedtke head of Active Gear, Inc. (AGI) is contemplating whether to invest in Mercury Athletic a subsidiary of West Coast Fashions (WCF). Mercury Athletic Footwear Back Ground West Coast Fashions, Inc. a large business of men’s and women’s apparel decided to dispose of one of their segments; Mercury Athletic. email us at support@caseprofessors.com Analytics for mercury athletic footwear case solution excel. Data source: Published sources. Reasons why Mercury is an appropriate target for AGI 4 2. Some evident synergy effects like revenue boosting, market share enhancement and suppliers’ diversification have made Mercury a very suitable target. How would you analyze the possible synergies or other sources of value not reflected in Liedtke’s base case assumptions? The shifts from concrete, objective, and visible inequalities in education, society and meeting human needs. Overview: Nike’s Five Forces Analysis. Therefore, the company is in a need to focus on its expansion strategy and searching for the market opportunities. Base Case Projected Segment Performance ($ in thousands) Projection of Selected Balance Sheet Accounts, 2007-2011 ($ in thousands) The acquisition price is calculated by multiplying this value with the historical average of net income. 9-410-S14 Spanish language Subject category: Finance, Accounting and Control Mercury Athletic: Valuing the Opportunity. The following table depicts the terminal value calculations. Top 10 blogs in 2020 for remote teaching and learning; Dec. 11, 2020 x 4 1/4" H overall. John Liedtke saw this as an … 79% Athletic 21% Casual. There has always been scrutiny of information two contingencies in the international latin exam, ethical issues how we might have happened if watson had remained the same time. your own Pins on Pinterest Therefore, it can help AGI to raise its post acquisition growth rate. Q1) Is Mercury an appropriate target for AGI? C I T E L Y H T AT T U N I : Y R R O R P A P U EE O C R H E TW T M OI N G FOA L U V RECOMMENDED VALUE Range of years of company’s steady growth which is reflected in its 2006 annual report, it reported revenue of $470.3 million and operating revenue of $ 60.4 million. 2: Both the companies carry out manufacturing in China. The industry is same, products are similar, markets are similar, greater ability to merge each other’s operating efficiencies and improve deficiencies, therefore it is evident that these factors confirm that Mercury is … Excel Northern Liberties. 1: Mercury will help AGI to roughly double its revenue. Mercury Athletic Valuing the Opportunity Case Solution, ... United States, Footwear, Athletic Apparel, Footwear. 100 out of 1000 Competition Index . Each group will value a publicly-traded company, and write a report to communicate their buy/sell/hold recommendation. Revenue. This exhaust tube bellow is constructed from black rubber. WCF in the year 2007 had announced a divestiture of Mercury, its non-core assets and renewed focus on its higher end business. Longzhan has 3 jobs listed on their profile. The industry is same, products are similar, markets are similar, greater ability to merge each other’s operating efficiencies and improve deficiencies, therefore it is evident that these factors confirm that Mercury is … A valuation report, counting for 10%. When students have the English-language PDF of this Brief Case in a coursepack, they will also have the option to purchase an audio version. 3: Mercury’s manufacturing costs are quite low in comparison with AGI. At the same time, Mercury secures highest profit margin from this same segment. Blog. Why or why not? Are they appropriate? Mercury Athletic Footwear: Valuing the Opportunity. Manufacturer calls this a 4" ID. 42% Athletic 58% Casual. 1: Beta for mercury is calculated by comparison with the companies having similar debt/equity ratio. Estimate the value of Mercury using a discounted cash flow approach and Liedtke’s base case projections. [$] Shop on Cheap Columbia Women's Mercury Maven II Vest on Sale [DEALS] Pearl Izumi Men’s Elite Inrcool Bib Short Article Related to Pearl Izumi Men’s Elite Inrcool Bib Short Elite athletes simply because 14 or 15 – year – old children who happen to Excel in a particular sport and play at a high level do not necessarily get their positions ‘elite.’ 4: The men’s casual segment for AGI brought the highest revenue. 5: The terminal growth rate is equal to the average growth of cash flow of the last five years. It made it the most valuable brand in the sports businesses. You're going places with this cycling collection. Nike is the top brand when it comes to producing sports shows and sports apparel. Mercury Athletic Footwear Case Solution,Mercury Athletic Footwear Case Analysis, Mercury Athletic Footwear Case Study Solution, QUESTION 1 If we look at the valuation of Mercury for the part D and part F, then a difference could be seen between the enterprise values. Mercury Athletic Footwear: Valuing the Opportunity Active Gear, Inc. (AGI) is a privately held footwear company and is contemplating the possibility of acquiring Mercury Athletic Footwear. Case Meeting – Discussion of Group Case #4h Mercury Athletic Footwear Case - The case uses the potential sale of Mercury Athletic Footwear (hereafter, MAF), a mid-size athletic and casual shoe company, to teach undergraduate and the first-year MBA students the basic discounted cash flow valuation using the WACC. The equity beta comes out to be 1.64. The synthesis of both can be very beneficial. Liddkte has wound off the women’s casual line after 2007, due to its low profitability. The historical revenue growth rate for Mercury for the last two years is 12.8%. Dec. 15, 2020. You can use it as a sample solution to prepare your assignment. How to increase brand awareness through consistency; Dec. 11, 2020. The head of the business development for Active Gear, Inc, John Liedtke, view this event as a good opportunity to acquire Mercury Athletic. 3: There is a chance of geographical diversification as Mercury caters to different demographics than AGI. Mercury had revenues of $431.1 million and EBITDA of $51.8 million during 2006. Introduction: Mercury. Its revenue on 2006 is $431.1 million and total asset is $270.6 million on 2006, Operating income (EBIT) is $42.3 million and net income is $25.9 million. Mercury Athletic Footwear Case Essay Sample. Executive Summary Great pressure from suppliers and competitors caused some deterioration of basic performance for AGI during 2004–2006. 2: Women’s casual line for mercury will be wound down in the first year. 4056 Subject category: Finance, Accounting and Control Authors: Joel Heilprin; Timothy A Luehrman. Mercury Athletic Footwear Valuing the Opportunity . You only have to pay once. With continuous efforts, the company succeeded in identifying the customers’ need and fashion pattern which resulted in growth in the revenue and EBITDA. Men’s casual segment growth rate is projected at 2.5%, which seems very appropriate as this segment brings the highest profit margin for Mercury and after acquisition, the growth rate should increase. Active Gear was one of the most successful firms in terms of profitability, in the footwear industry. WCF has acquired Mercury during its strategic expansion plan. ch10 - Free download as Powerpoint Presentation (.ppt), PDF File (.pdf), Text File (.txt) or view presentation slides online. Published by: Harvard Business Publishing (2009) Format:.xlsx. Is Mercury an appropriate target for AGI? email us at support@caseprofessors.com Its casual footwear was sold by more than 5700 North American department.After. MGMT S-2720 Assignment 1: Mercury Athletic Footwear Questions There is sufficient evidence to suggest it will be advantageous for AGI to acquire Mercury Athletics. Excel Calculations. Mercury Athletic Footwear: Valuing the Opportunity Active Gear, Inc. (AGI) is a privately held footwear company and is contemplating the possibility of acquiring Mercury Athletic Footwear. The net cash flow at the end of 2011 is used to calculate the terminal value. Liedtke wants to make sure that besides the ‘evident synergies’, there should be some financial benefit of acquiring Mercury. THus Freddie mercury height in shoes would be close to 5'9. Business did not do as expected, WCF was then eager to abandon its apparel. Mercury Athletic Footwear Case Essay Sample. Enjoy year-round function and minimal maintenance, just like astro turf, in a pair of football trainers!With a cushioned midsole and short dimple style studs, astro turf trainers and boots provide comfort and grip on older 2G turf pitches and artificial surfaces. Despite of this great success, the company due to its smaller size created a strong negative image in front of its stakeholders. In January 2007, West Coast Fashions, Inc., a large designer and marketer of branded apparel, announced a strategic reorganization that would result in the divestiture of their wholly owned footwear subsidiary, Mercury Athletic. Come join us and watch your young athlete rise. The Business plan on Mercury Athletic Case. • Both the companies’manufacturers are located in China, which can ensure the competitive advantage over the rivalries. Our essay writing services are the best in the world. Athletic Footwear Market Overview. Mercury Athletic Footwear Case DCF VALUATION ANALYSIS Jianqiu … Should AGI purchase Mercury? In January 2007, West Coast Fashions, Inc., a large designer and marketer of branded apparel, announced a strategic reorganization that would result in the divestiture of their wholly owned footwear subsidiary, Mercury Athletic. Crafted especially for men, this range of not only bikes, but the clothing, footwear and accessories to go with them, brings adventure you crave. Active Gear, Inc. (AG), a privately held footwear company, was contemplating an acquisition opportunity. Mercury is specialized in designing and distributing the branded athletic and casual footwear. 100 out of 1000 Keyword Advertise . an ag em en t. Active Gear Demographics. This might be a good idea to write off women line completely for valuation purposes; however, after the acquisition the AGI should merge the Mercury women’s casual line with its line to gain some more revenue and higher return for investors. Discover (and save!) Let us do a pestle analysis example of Nike to know where it stands. Just because it’s cold, snowy, rainy, or a downright blizzard outside doesn’t mean the treadmill is your only option. 4005 Ludlow Street Philadelphia, PA 19104. Review the projections formulated by Liedtke. Mercury Athletic Footwear: Valuing the Opportunity Case Solution. It earned US$30.601 billion in 2015. The cost of debt is taken to be on an after tax basis to further to account for the depreciation tax shield. AGI is a profitable company; however, its size is not large enough to cater for market expansion opportunities. Purchase Mercury hence nearly 5 ' 9 us and watch your young athlete rise reasons why Mercury an... 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