From its criteria used to select acquisitions to its organizational structure, Cooper Industries is constantly trying to uncover opportunities to acquire and divest companies in the pursuit of increasing economies of scope and profitability. Acquisition Guidelines for Diversification Cooper has specific, detailed guidelines for its diversification approach. It will only acquire firms that will fit easily into their mold:
If I was Mr. Cizik, then I woulddefinitely try to gain control of Nicholson File co. Not only that, but it would also be an opportunity to increase long-term growth potential by increasing the exposure of respective product lines to new markets and customers.
Gainingcontrol would create synergy between both the companies and would reduce the cost of goods sold, along with general and admin expense. Moreover, it would reduce the concern over heavy dependence on sales on oil and gas industries along with sudden fluctuations of earnings caused by the cyclical nature of heavy machinery and equipment sales.
What is the maximum price that Cooper can afford to pay for Nicholson and still keep the acquisition attractive from the standpoint of Cooper? The working is shown in the excel sheet.
What are the concerns and what isthe bargaining position of each group of Nicholson stockholders? What must Copper offer each group in order to acquire its shares? Cooper was not alone regardingits interest in Nicholson, where H. K porter owned shares since as well as it wasan active stakeholder since the acquisition.
The bargaining power of all the stockholders is high because the company is profitable and everyone wants to gain high return fromtheir investments. Working is shown in the excel sheet. The recommendation of Mr. Cizik should to the board of the directorsshould be in favor of Nicholson as it seems to be abetter option for the company to increase itsprofitability and to gain the benefits as stated above.Case Study: Tesla Motors Innovative Vehicles, Innovative Manufacturing.
Tesla Motors is one of the world’s foremost manufacturers of all-electric automobiles. Cooper Industries, Inc. is a manufacturer of heavy machinery and equipment.
It has acquired some companies in the past as part of their expansion plans.
Cooper acquires companies that are leading in their area of business, have a large market share and is the leading company in their area of operation. California Community College Cuts Costs in Half.
In the fall of , Chabot-Las Positas Community College District recognized an opportunity to reduce energy consumption by upgrading its facilities with more energy efficient lighting.
For many industries, production downtime and scheduled outages are few-and-far between. While logic and best practice may suggest a need for system redesign, a filtration upgrade or a complete flush, the pressure from production to continue operations until the next scheduled shutdown usually wins out - .
Cooper Industries Proposal to Acquire Nicholson File Company 1.
Cooper Industries Proposal to Acquire Nicholson File Company MAY 3, 2. Previous Acquisitions Lufkin Rule Company Crescent Niagara Corporation Weller Electric Corporation Cooper industries Case Study Prashant S.
Keswani. Senior Business . Eaton is a power management company with sales of $ billion. We provide energy-efficient solutions that help our customers effectively manage electrical.