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9-204-021
REV: MARCH 31, 2006
MIHIR A. DESAI
Dow Chemical's Bid for the Privatization of PBB in
Argentina
op yo On November 10, 1995, Oscar Vignart, vice president of business development for Latin America for Dow Chemical Company (Dow), and Luis Marcer, CFO of Dow Química Argentina, considered the bidding price on Petroquímica Bahia Blanca S.A. (PBB), which was being privatized by the
Argentine government. PBB produced both ethylene and polyethylene. It was part of a petrochemical complex located in Bahia Blanca, 700 kilometers south of the Argentine capital, Buenos
Aires.1 Vignart believed that the acquisition of PBB offered Dow a once-in-a-lifetime opportunity to become the leading polyethylene player in Latin America.
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A plant for cracking ethane was estimated to cost $400 million to $500 million, a plant for cracking naphtha
$1 billion.3 Roughly half of the world’s ethylene plants, particularly those in gas-poor regions such as
Japan and Western Europe, utilized naphtha. Plants in gas-rich regions such as North America and the Middle East more frequently employed ethane from natural gas streams.4
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Large plant sizes and the need for economies of scale rendered the ethylene industry highly capital intensive. Consequently, capacity additions or reductions could significantly affect balance of supply and demand, influencing capacity utilization rates, prices, and profit margins. Ethylene profitability was tightly linked to its global operating rate. Among the investors in the ethylene business were oil companies, governments, pure chemical companies, conglomerates, private investors, and joint ventures. According to UBS Warburg plc, financial return objectives ranged from loss leader to zero return to beating the cost of capital. The loss leader or zero-return player was often a government operator that was, directly or indirectly, financing capital-intensive ethylene plants in order to stimulate downstream business. This was the case in Brazil, where the government sponsored a “tripartite” model, in which private Brazilian capital, multinationals holding the technology, and the government would each
Production line workers are the employees who are usually doing their work by hand or in this day and age, running the machine or equipment to make the products. In this particular case, Canada Chemicals Corporation utilizes their production employees by producing industrial chemicals. These production worker’s jobs are a lot more complete then other production level workers employees as they usually have plenty of skill, knowledge and experience, and have high educational background. In order to reverse recent challenges with production and sales, I have composed a compensation package for these employees that will motivate them intrinsically, and focus on rewards that are extrinsic.
return on the assets of his division and it is higher than the target specified. He appears
The latter has further been exacerbated by a lack of incentives for Metro branches, the main sales and marketing agents for the product, to sell Due Bills.
Chapter 11 focuses on ammonia. Ammonia was first discovered in 1909. It ended up being very helpful in the growth of plants and food. Not only did ammonia
the earth and projecting a mixture of chemicals and water into the ground to release the gas
João Nogueira Batista, Chief Financial Officer of the Brazilian firm Petrobras, reflected on Gros’s words as he prepared for a Board of Directors meeting in July 2002. The main item on the Board’s agenda was the proposed acquisition of an Argentinean firm, the Perez Companc Group, or Pecom.2 The acquisition would significantly increase Petrobras’s oil and gas production and add to its oil reserves. It would also provide the mainly Brazilian-based
and the economy by raising the quantity needed to be supplied to keep up with the demand of the
Cabe señalar que nos encontramos en una economía global en donde se espera que, como mínimo, las inversiones deban rendir a la tasa libre de riesgo, que para efectos de valoración se considera la tasa de los tesoros de largo plazo. Además, debemos tener en cuenta el beta de la industria petrolera, el cual se puede calcular de las empresas de este sector que cotizan en bolsa. Así, con esto en mente, se pude hacer una valoración para determinar si al final se podrá tener la rentabilidad esperada arriba del 14%, que se exige Petrobras.
Polyethylene is the world’s most widely used plastic. Polyethylene plastic’s principal application was in packaging, from trash bags to milk jugs. It was widely used in the manufacture of everything from trash bags, picnic cutlery and garbage pails, to plastic toys. Polyethylene also replaced glass, wood, and metal in certain applications.
This paper is talking about the Johnson & Johnson Acquires Dabao. It starts with review the two companies’ history, and then shows the problem of them before acquiring. Further analysis of Johnson & Johnson’s decision with the problems that in their decision making process and also the decision making style that could be found in the acquisition. At last, give some
In this case, large construction firms organized an illegal cartel with the aim of earning overpriced contracts from the oil company. To maintain the cartel and guarantee that only members could win Petrobras’ contracts, the companies bribed Petrobras’ employees, who were mostly selected by politicians. Hence, much of the extra revenue was allegedly funneled to political parties in order to fund campaigns. Investigators have uncovered over $1.8bn in bribes paid and total losses to the state estimated at between $8.3bn and $12.0bn. They have charged approximately 180 people with criminal offences and secured 93 convictions, including the C-suite executives of the construction companies that composed the cartel. Dilma has not been accused of any crime regarding Petrobras, even though she was a Board member between 2003 and 2010, when much of the corruption allegedly took
Natural gas is said to be one of the most popular forms of energy today. In the past, often
be involved in. This ultimately can lead to an increase in production as well as expansion of
Newell's corporate strategy was mainly focused on high volume and low cost product to large mass retailer. The goal of the company was to increase its sales and profitability by offering a complete and complementary range of products and reliable service to the mass retail stores. Newell's initial focus was on home and hardware products which later on expended to other markets. The company strategy was to grow and expand its product line through acquisitions, rather than internal growth. Before 1998 Newell acquired different companies in the basic home and hardware products industry and started diversifying into unrelated field such as children products, widow covering, writing instruments and others. The company was also looking to
Before the nineties the Coca-Cola company was having a centralize system of control, but after sometime they realized that if they had to meet the demands of the customers they should adopt a decentralized system in which the authority of decision making is distributed between different managers so that every sector can be managed effectively. This system was implemented in the nineties by the company’s board of directors. Now the organization is having two groups who are responsible for operating: