Thomas Weisel Case
1.As a Montgomery Securities partner in mid 1997, would you argue for or against selling the firm to NationsBank? Why? Montgomery experienced great prosperity in the1990’s, its revenue leaping more than sevenfold, from $94 million in 1990 to $705 million in 1997. Most of its success came from investing in fast-growing companies. On June 30, 1997, NationsBank Corporation of Charlotte, N.C. announced that it was acquiring Montgomery for approximately $1.3 billion, believing that the combination would create one of the nations top full-service investment banks. The acquisition price was about 15 times the firm’s earnings and 13 times its book value. Before the sale of the firm to NationsBank, Weisel said, “We
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Weisel was aware that his legacy would now be not his previous accomplishments but the success or failure of TWP. Although convinced that the firm’s business plan, strategy, and team would deliver top performance. Thomas Weisel partners believed that an entrepreneurial bank could attract highly talented bankers who would become the competition against established top banks. His strategy for creating a dynamic firm that attracted the best and the brightest was to establish a “research-driven” merchant bank focused on the new economy that was transforming key growth sectors, technology, consumer and business services, media and communications, healthcare, and financial services. Weisel structured TWP around the concept of “tailwinds,” currents or vendors that, moving faster than the rest of the economy, act as agents of change and power future growth.
A niche strategy can succeed if the company finds a specialty that immediately and clearly distinguishes you from the competition, and then get really good at it. You'll have more customers or clients, you'll have an advantage over competitors, and best of all, and the company will make more money. Also, when you cater to a niche, either a specific demographic group or industry, customers believe that you understand them.
4.What advice do you have for Thomas Weisel as TWP proceeds into 2000 and beyond? Specifically, what should TWP’s competitive and growth strategies be going forward?
Tidal Community bank is a success business for a period of time until the day the management realized that the growth has been slow down and to maintain the growth, Matt, chairman and CEO and John, president and COO, have decided to expand their market by acquire a bank in a larger metro area. While both John and Matt, as well as Granary’s management believe that this will be a right direction for the long term development of the bank, Eagleeye, the largest investor and other institutional investors do not have the same opinion on the expansion plan. They believe that the strategy to success in a local community area will not be the same as in a larger metro area, which means they will receive an undesirable outcome.
15. How has the company’s stock been performing in the last 5 years? Steadily rising since 1/2009. Declining from 2007 – 2009 as expected due to the recession and the change in demand for construction.
Another option for NCB is to start its own distribution company. This option will require a significant capital investment in addition to the losses due to Harrison’s bankruptcy. If we look at the balance sheet of Harrison we can see that Net PP&E + Land amounted to $ 3,295,000. If NCB will decide to take this option, it must invest a similar amount. In addition, inventory investment is required and will be at minimum $ 500,000.
1. Identify the key factors responsible for the success of Gordon Biersch to date. What concerns, if any, do you have as the company looks ahead?
4) What advice would you offer John Chambers in managing Cisco’s culture through the transition?
4. What offer would you make in an effort to gain the support of the Robertson family and the great majority of the stockholders, while improving the long-term trend of Monmouth’s earnings per share over the next five years?
A) What is the possible meaning of the changes in stock price for GEICO and Berkshire Hathaway on the day of the acquisition announcement?
5. Should the company seriously consider any other options besides doing a spin-off or issuing targeted stock?
Young Professional magazine was developed for a target audience of recent college graduates who are in their first 10 years in a business/professional career. In its two years of publication the magazine has been fairly successful. Now the publisher is interested in expanding the magazine’s advertising base. Potential advertisers continually ask about the demographics and interests of subscribers to Young Professional. To collect this information the magazine has commissioned a survey to develop a profile of its subscribers. The survey results will be used to help the magazine choose articles of interest and provide advertisers with a profile of subscribers. As a new employee of the magazine, you have been
3. Is CoMark an attractive investment? What are your major concerns with the proposed deal? How attractive is the purchase price?
3. What are the biggest risks faced by the firm in the next 5-10 years?
* Technical Leadership – Immelt identified technology as a key driver of GE’s future growth and emphasized the need to speed up the diffusion of new technologies within GE and turn the corporate R&D into an intellectual house.
A specialization strategy focuses on a narrow market segment or niche and pursuing either a differentiation or cost leadership strategy in that market segment according to Jean Phillip and Stanley Gully. To be successful, businesses following a specialization strategy are required to know their market segment very well, and often enjoy a high degree of customer loyalty. The company can be successful using this strategy if it results in either lower costs than competitors serving the same niche or an ability to offer customers something that other competitors cannot.
Discuss the strategic decisions that firms in this sector may be facing. What future strategies can firms pursue to try to secure their competitive advantage and long term survival?
AS MR. WILSON 'S FINANCIAL ADVISER, WOULD YOU URGE HIM TO GO AHEAD WITH, OR TO RECONSIDER, HIS ANTICIPATED EXPANSION AND HIS PLANS FOR ADDITIONAL DEBT FINANCING ?