Hilmi and Arifin Panigoro are considering a two-stage plan: a Leveraged Buy-Out (LBO) to be followed by a secondary equity offering at a share price high enough to enable them to repay the loan and retain majority control of their company. As attractive as the plan seems, they worry about the high cost of the loan and the risk that the offering might fail. In January 2005, with no time left to consider alternative financing plans, the Panigoro brothers have to decide whether to go ahead with the plan or lose control of Medco to Temasek. Students are required to evaluate the benefits and risks of the proposed financing plan from the perspective of both the controlling family and minority shareholders.