Key Questions:
Key Questions How did Ben & Jerry’s become a target?
What evidence is there that shareholders are dissatisfied with the company’s performance?
Didn’t shareholders know company had other priorities besides profit?
What other stakeholders have an interest in this takeover?
ROE Performance:
ROE Performance Year ROE 30 Year T-Bonds
1994 -2.6% 7.9%
1995 7.5 6.0
1996 4.7 6.6
1997 4.5 5.9
1998 6.8 5.1
1999 8.9 6.5
Common Takeover Defenses Pre-offer:
Common Takeover Defenses Pre-offer Supermajority
Dual class recapitalization
Staggered board
Poison pill
Poison put
Golden parachutes
Fair-price amendment
Common Takeover Defenses Post-offer:
Common Takeover Defenses Post-offer Management buyout
White knight
White squire
Greenmail
Asset restructuring
Liability restructuring
Management resignation
What is a Fair Value for the Company?:
What is a Fair Value for the Company? Benchmarks
Comparable firms
Valuations
Financial Institutions:
Financial Institutions Types of institutions
Banks
Insurance companies
Pension funds
Mutual funds
Hedge funds
Payment mechanism
Borrowing and lending
Pooling risk
Next Class:
Next Class Presentation by State Farm Investment Department
Fixed income investing
Review for midterm exam
Exam is Tuesday, March 6, during class