Mercury Athletic

First, the projected cash flows range from $21.2 million in 2007 to $29.5 million in 2011 as shown in the data exhibit ‘DCF model.’ To generate these numbers Liedtke’s base case performance projections are used for the projected 2007 – 2011 net revenue numbers and the estimated depreciation and then his projections for Balance sheet accounts were used to determine the current net working capital and capital expenditure as in the exhibit ‘Financial statements.’ These projections were based by Liedtke under the following assumptions, women’s casual footwear would be wound down within one year and the historical corporate overhead-revenue ratio would conform to historical averages. These annual cash flows give us a PV (Cash flows) of $96.15 million over the next 5 years.

How would you analyze possible synergies or other sources of value not reflected in Liedtke’s base assumption?

Here is a rundown of the variables we used to first determine the cash flows for Years 0 through 10: depreciation of equipment over the 10 years, sales minus COGS to identify gross profit, summed expenses (advertising, start-up, and Jell-o erosion only; the test market expense in Year 1 is considered a sunk cost and thus should not be included), and subtracted taxes to come up with the cash flow. When assessing the below issues, the team concluded the following

The background of this paper we need to mention is that West Coast Fashions, Inc. (WCF), a large designer and marketer of branded apparel announced a strategic reorganization calling for a divestiture of certain assets, and one of the divisions it intended to shed was Mercury Athletic, its wholly owned footwear subsidiary. John Liedtke, the head of business development for Active Gear, Inc. (AGI), a privately held athletic and casual footwear company, contemplated an acquisition opportunity of Mercury that would significantly improve his business. So, he wanted to evaluate this opportunity.

Analyzing the industry using Porter’s Five Forces, it can be seen that the Outdoor Apparel industry is very competitive. The threat of entry is very high, with several large conglomerates making acquisitions in the industry and established apparel companies such as Polo Ralph Lauren making expansions into sports apparel. With several brands such as North Face in the high end of the industry, as well as Columbia and several private labels dominating the middle and lower ends, a large number of substitutes are available. Buyers have large bargaining power, as end consumers could easily switch to another brand, while at the same time wholesalers are

This report has been created with the intent to analyze the athletic apparel industry with a specific focus on Lululemon Athletica, Inc., further refered to as Lululemon. In this report you will find that the strengths and weaknesses of Lululemon’s current strategies and future goals are analyzed and compared to that of its closest competitors. In conclusion to the analysis, recommendations have been made to potentially guide Lululemon Athletica, Inc. in a positive direction in regards to its future endeavors. The following

Belle Montaseur’s Inc. is a high-end shoe company (firm) with a reputation for integrity, quality craftsmanship, and excellence in management. In the final year our Game-to-Date (G-T-D) Score came to eighty five. Belle Montaseur’s Inc. was formed by Michael P. Blattner as an entity in September 2013. In Year Eleven our Net Revenues were $253,670,000. In Year Eighteen our Net Revenues were $273,077,000. We had a couple of down years from not allowing a forty percent markup in prices which was one of our major downfalls (this led to bad numbers for those Years). We did not earn a Gold Star Award like Dashing Shoes did every year.

2. Estimation the value of Mercury based on discounted cash flows and Liedtke’s base case projections.

Notice that a merger analysis consists of two estimating issues which are projected merger cash flows and the appropriate discount rate. Sometimes, estimating cash flows in a merger is a little difficult so that we need to summarize the series of yearly cash flows and inflows. Mr Harry, we need to be aware, although Mr Jack is your friend, he may refuse to provide detailed information about Framingham Flange Factory’s future projections or past history. The second issue is the appropriate discount rate due to an acquisition is an equity transaction; it should be done using a discount rate that reveals the cost of equity

After carefully analyzing the data given, we believe that FVC’s value is roughly $270 millions, including synergies. The company’s stand-alone equity value is more than $158 millions. The synergies that derive from this acquisition are extremely beneficial to both FVC and RSE. RSE’s purchasing power would help to reduce material costs for FVC. The acquisition would also bring in estimated tax savings of $2 millions the first year and $4 millions thereafter. RSE’s new project, CORE, is expected to improve and save in-process costs for FVC, making it more efficient and helping to increase the company’s bottom line. Moreover, FVC could utilize RSE’s marketing power and strategies to advertise their new advanced hydraulic-controls system or “widening gyre”. Flinder believed that the

Sports footwear and apparel expected will growth in future as customers cannot substitute these products. However, ASICS have to implement or produce with more high technology product to enhance

Columbia competes with many different companies in the apparel industry. They name a broad range of different companies manufacturing a very large number of products, but their main competitor is VF Corporation, the holding company for brand names The North Face® and Timberland® footwear. VF Corporation is significantly larger than Columbia due to the additional brand names they carry in the apparel sector but that do not directly compete with Columbia such as Lee jeans. Columbia competes on a day to day basis with The North Face on product quality, innovation, and fashion levels. Columbia has proven to be more innovative yet their balance sheet shows a company with a more conservative approach to growth. VF Corporation has been growing through aggressively purchasing or merging with other companies (Timberland was their latest in July of 2011). Columbia is not anathema to this strategy but they are slower and more deliberate in the process. A complete comparison of company ratios can be seen in Exhibit 12. The table below indicates selected ratios of various competitors.

Under Armour was founded in 1996 and is known as a leading developer, marketer, and distributor of branded performance apparel, footwear and accessories. Under Armour’s target market is athletes on the professional and collegiate level as well as consumers with active lifestyles. The company’s widely recognized brand is known for performance an authenticity, and is an alternative to traditional natural fiber products and non-performance apparel and footwear. The case analysis performed will evaluate the company’s vision and mission statement, internal and external situation, possible strategy options going forward, and recommendations for the company.

Looking into a future new venture for myself I decide to start-up a business like Nike, because of the performance that Nike has had in the shoe industry has been remarkable all across the globe for many years. It is one of the country’s largest and highly respected brand names, not only in the United States sector, but it highlights the international globe as well. Nike is a sporting goods company and distributor that offer’s all type of athletic shoes, sporting gear, and many different accessories that are used for people that are into sports and fitness. A lot of different teams in the sports industry uses Nike equipment, shoes, and accessories because of their amazing background name for their products and services that they offer. So since Nike has that title brand and as a company they have prospered in many ways and I would like to start-up a shoe company similar to Nike since they have profited very well on the market with minimum declining levels with still manage to pull through in the end.

This case study is about Under Armour, a company that deals with the manufacture and sales of all forms of sportswear and accessories. The company has had great sales in most of its products like moisture-wicking shirts and athletics shoes. Despite this, the company still holds only 5% of the market shares, trailing behind Nike, Adidas and Asics. Moreover, the company posses low financial strength such that it cannot launch multiple products in multiple categories at the same time like its competitors.