Preview

Newell Harvard Case Summary

Good Essays
Open Document
Open Document
1853 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Newell Harvard Case Summary
MEMORANDUM
To: Acquisition Team
From: Adriana Pinzón – Consulting Team
CC: James Biteman - CEO
Date: 27-09-2010
-------------------------------------------------
Subject: Recommendations about the acquisition of Sanford Corporation.
Bearing in mind our philosophy or “profit growth by acquisitions”, I would like to recommend to the Acquisition team the evaluation of Sanford Corporation for purchase, for the following reasons:
Even though it is a $600 Million acquisition, the most profitable company we have ever consider as a takeover target, it is a company with a very well establish reputation of good management , that can be easily adapted to our business model . Despite having a good management, they have less than ten people
…show more content…
How might strategic issues change the results of an analysis based strictly on costs?

Considering our strategy to expand the company, which consist on developing useful and well made products, that people can use everyday, my recommendations about the mentioned acquisitions are the following ones:

* Recently Newell’s entered to the office products line with two small acquisitions, identifying the potential growth of this market. According to this, acquiring Sanford Corporation represents an opportunity to improve our position on the market and reducing the number of our existing
…show more content…
This company needs a Newellization process, focusing on operational efficiency and profitability to raise the level of service, quality and speed of delivery. In spite of the present situation of Levolor, where a significant investment in the company is required, I recommend this acquisition option because in terms of the company price is a good deal that also complements our product portfolio, implanting a sales crossed scheme through the commercialization channel complementing our present

You May Also Find These Documents Helpful

  • Good Essays

    Bear Stearns Case Summary

    • 427 Words
    • 2 Pages

    In the 1940’s, the firm became a large player in mergers and acquisitions, particularly in the…

    • 427 Words
    • 2 Pages
    Good Essays
  • Best Essays

    “Acquisitions have historically been part of our strategy, and will continue to be in the future,” stated…

    • 2833 Words
    • 12 Pages
    Best Essays
  • Powerful Essays

    Mg 495 Week 3 Case Study

    • 4356 Words
    • 18 Pages

    CASE 35 – CHURCH & DWIGHT: TIME TO RETHINK THE PORTFOLIO? I. INTRODUCTION A. EXECUTIVE SUMMARY 1. Summary statement of the problem: Church & Dwight, more commonly known by its brand name “Arm & Hammer,” has held a commanding lead in the sodium bicarbonate product market for over 160 years with virtually 99 percent of all consumer products in households within the United States. However, in order to promote growth and diversity while maintaining a steady profitability rate of 3-5 percent per year, the company has expanded uses of sodium bicarbonate products so that it is no longer the sole focus. In fact, the acquisition of a diverse group of consumer products in international markets has been viewed as a viable option to sustain the profitability margins well into the 21st century. (Wheelen & Hunger, p. 35-12, 2012). 2. Summary statement of the recommended solution: The relatively small company, as compared to competitors in household and personal care product markets must recognize the challenges of growing sales through acquisitions to promote growth and competitiveness within those markets, Church & Dwight must incorporate additional acquisitions of solid brands and products in order to grow market share through an expansion of product lines into a variety of “personal care, deodorizing and cleaning, and laundry products” as well as “specialty chemicals, animal nutrition, and specialty cleaners” (Wheelen & Hunger, p. 35-6, 2012). In addition, to maintain its position in the world market place, Church & Dwight must expand into international markets and gain footholds in product markets through acquisition of…

    • 4356 Words
    • 18 Pages
    Powerful Essays
  • Powerful Essays

    The Timken Case

    • 4265 Words
    • 18 Pages

    The presented analysis, recommends in our opinion, the best course of action in the proposed acquisition of the Torrington Company:…

    • 4265 Words
    • 18 Pages
    Powerful Essays
  • Powerful Essays

    This board report summarizes the arguments for why it is believed that the acquisition of Southern Comfort Corporation (including Caligrapo Inc.) is a strategic fit that will increase shareholder value through increased sales and profitability…

    • 3386 Words
    • 14 Pages
    Powerful Essays
  • Good Essays

    For this paper, selects Johnson & Johnson (J&J) and Questcor Pharmaceuticals the US companies to acquisition. This paper explains the best combination method of Johnson & Johnson for expanding the corporation through acquiring Questcor Pharmaceuticals. Johnson & Johnson pay $15 million in goodwill of Questcor Pharmaceuticals during acquisition. Moreover, it explains the reason behind the selection of combination method and the way to grow the business. It also analyzes the requirement of accounting for the combination method of business and also prepares consolidated financial statements for the date of acquisition. In addition, it also determines…

    • 928 Words
    • 4 Pages
    Good Essays
  • Good Essays

    Rubbermaid Merger Case

    • 434 Words
    • 2 Pages

    The “newellization” of Rubbermaid is also made more difficult by the sheer size of the company. The majority of Newell’s past acquisitions have been relatively smaller companies that they have successful applied the newellization process and generated great synergy. In the case of Rubbermaid, it is a company that is worth billions; therefore, Newell may not have the necessary experience needed to integrate such a massive company. Even if “newellization” is possible, it may take a long time because it is difficult to suddenly change the operations of a well-established company, like…

    • 434 Words
    • 2 Pages
    Good Essays
  • Satisfactory Essays

    WHERE WILL THE VALUE FOR THE 50% ACQUISITION PREMIUM COME FROM IN THE PROPOSED BUYOUT?…

    • 350 Words
    • 2 Pages
    Satisfactory Essays
  • Satisfactory Essays

    Daniel Ferguson

    • 579 Words
    • 3 Pages

    In addition, the business must be deemed strategic and remain suited to the company’s main focus. The logic behind all of these acquisitions was to ultimately increase Newell’s “profit growth not sales growth” and target products that were in high demand that would allow maximum “shelf space” as one Newell executive notes. For example, Montgomery mentions that “Calphalon broadened Newell’s access to the department and specialty store markets and extended the company’s cookware product line to the top of the market”. In addition, Montgomery also says that after acquiring Rubbermaid, Newell “would have a greater global presence and broader product offering than Newell alone”. Globalization was the long term goal for combining business for Newell since the majority of their customers were starting to become global. Montgomery also mentions that Newell acquired small businesses to “round out its existing product lines and consolidate industry capacity” so they would not have to worry about customers supporting their major competitors and giving them an opportunity to…

    • 579 Words
    • 3 Pages
    Satisfactory Essays
  • Better Essays

    These past few years have been very trying for High Land Bikes. Our Kids Bike and Commuter Bikes have shown complimentary sales and proven to be our strongest lines. We have been fortunate enough to establish a following in these product lines and are very competitive in the biking market. High Land Bikes had some trouble establishing factories and capacity because of an underestimation of consumer demand, but with an early loan we were able to overcome market difficulties, reduce our debt, and breakthrough with stable, profitable growth. Consumer confidence has been restored in our product lines and we look to the future to refine this line and prove to investors that we are a key player in the biking market.…

    • 2542 Words
    • 11 Pages
    Better Essays
  • Satisfactory Essays

    Change Anaysis Image

    • 767 Words
    • 4 Pages

    When we consider acquisition it is really a prior intent and in the context of our business environment this change is beneficial for our company, while our employees are interested in success of our firm which is their own personal success and well-being. Also, it is evident that our change lied in…

    • 767 Words
    • 4 Pages
    Satisfactory Essays
  • Good Essays

    Newell Corporate Strategy

    • 1031 Words
    • 5 Pages

    This two-pronged strategy proved to be quite successful as Newell acquired more than 40 major businesses till 1998. The company acquiring strategy allowed them to add business that are similar in nature to its portfolio and thus consolidate industry capacity. Such a move allows them to enjoy economies of scale but offering differentiated products of the same category to suit different customer as a result. “Newellization” includes transferring higher technology from Newell to these companies that had been acquired and thus they are able to supply goods in faster time while quality of the products is not being compromised. These companies do not have such system and process and also do not have bargaining power with companies and thus higher cost is incurred by them and the customers. Newell also restructures the management in the companies by removing executives they feel who are too comfortable in their positions and also ensure that the companies do not over-employ people or under-employ people. Product lines making losses will be removed while stores that would not add value to the company are closed.…

    • 1031 Words
    • 5 Pages
    Good Essays
  • Powerful Essays

    Disney and Pixar

    • 5364 Words
    • 22 Pages

    Careful thinking about what it means for an acquisition to succeed, coupled with an analysis of why deals fail, can lead to some practical advice for managers, thus helping them to develop a more refined view. More specifically, in order for acquisitions to pay off, they ought to pass four tests. I describe the tests below, showing how each offers a way to head off common sources of merger malfunction.…

    • 5364 Words
    • 22 Pages
    Powerful Essays
  • Good Essays

    Newell case

    • 1132 Words
    • 5 Pages

    Newell, manufacturer and marketer of basic home and hardware products, is a rather unrelated diversified company with more than 30 operating businesses. Grown over the years through many acquisitions, the company is facing one of her most important challenge: the acquisition of Calphalon (high-quality cookware) and Rubbermaid (plastic products). Both the acquisition were part of that period’s CEO’s plan to increase Newell’s strength on the market, and to boost the capitalization to $10 billion, in order to reach higher EPS and, in so doing, create more value for shareholders. Calphalon is a private high-end aluminum cookware manufacturer, distributed in department and specialty stores and with a new developing product line for the mass retailer Target. Analyzing Calphalon’s issues, it comes out that its acquisition by Newell (consisting in a process of related diversification) would create value for both companies. In fact we must consider all the valuable things that this cookware manufacturer has to offer to its acquirer and vice versa: new channels where to sell premium products, that is to say non-mass merchandise markets, without cannibalizing Newell’s products sold in mass retailer stores (remember that Newell owns other cookware manufacturers); enhancement of competitive advantage through skills sharing, like Calphalon’s expertise in developing pull strategies and building strong connection with final consumers; strengthen Newell’s reputation by acquiring a prestigious brand name, thus not only functional objects, but also emotional ones; existence of a still profitable market in which other competitors haven’t reached a real leading position yet. About this last point, it’s important to highlight that the acquisition by Newell is fundamental for Calphalon in order to reduce its prices, always 20% higher than its main competitor Mayer. According to the theory, if the diversification has solid foundation, it allows to…

    • 1132 Words
    • 5 Pages
    Good Essays
  • Powerful Essays

    The cultures of Bank of America and MBNA were incompatible because MBNA 's culture was characterized by a free-wheeling, entrepreneurial spirit that was also quite secretive. MBNA employees also were accustomed to the high life. Their corporate headquarters in Wilmington, Delaware, could be described as lavish, and employees throughout the company enjoyed high salaries and generous perks from the private golf course at its headquarters, to its fleet of corporate jets and private yachts. Bank of America, in contrast, grew by thrift. It was a low cost, no-nonsense operation.…

    • 776 Words
    • 4 Pages
    Powerful Essays