Question
Corporate executives engage in reorganizations to improve shareholder value. If shareholder value increases, the reorganization often is deemed a success. If shareholder value falls, corporate
Corporate executives engage in reorganizations to improve shareholder value. If shareholder value increases, the reorganization often is deemed a success. If shareholder value falls, corporate executives may take the blame.
Pick a reorganization of a publicly traded company that occurred between three and seven years ago. Obtain the monthly stock price for the parent company for the three-year period before and the three-year period after the reorganization (six years total). Then obtain the monthly stock price of an S&P 500 Index mutual fund, as well as the monthly stock price of a major competitor of your company over the same period.
Pick two performance metrics (e.g., return on assets, return on equity), and calculate those ratios for the merged company for the three years following the reorganization. Compare those performance metrics to the same metrics for the firms major competitor for the same period.
Use Microsoft Excel, or a data visualization software package, to create no more than five appropriate tables or charts that show how the reorganization added to or diminished shareholder value. Place those visuals into Microsoft PowerPoint, along with two other slides that provide your arguments for or against the success of the merger. Your slides should be visually appealing, easy to interpret, and concise.
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