Mod 5 Slp

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MOD 5 SLP: Net Present Value, Mergers, and Acquisitions Trident University International Strategic Corporate Finance FIN 501 MOD 5 SLP Introduction Garmin is a global supplier of Global Positioning Systems. The company targets primarily the aviation, maritime and fitness industry. Garmin is the current leader in the GPS market boasting the highest equity and lowest debt in the industry. For Garmin to merge with another company, it would have to provide significant long term synergy or allow expansion into a new market entirely. A merger between Garmin and Trimble Navigation would benefit both companies and their shareholders. Garmin Limited – KVH Inductries KVH (KVHI) develops mobile communications products for land and…show more content…
If Garmin watched this company closely it could provide an opportunity to gain a significant portion of the overseas Personal Navigation Device (PND) market. This is currently the only sector Trimble beats Garmin at a 34% to 47% ratio, and has for the past seven years. This merger would also require detailed consideration as it would require international equities to be merged along with significant human and financial resources. Conclusion Garmin stands to gain from a merger with Trimble. The merger would allow Garmin to acquire a significant portion of the European personal navigation device market share at minimal cost. Garmin has the cash resources to execute the acquisition and while Trimble’s finances are in decline for the near term they are expected to remain a solid long term investment. The acquisition would result in an approximate $13 dollar increase in Garmin’s stock price, and increase long term equities. Other companies Garmin should consider are KVL Technologies for its opportunity to get ahead of maritime mobile communications technologies, and Roper Industries, which would enable expansion into a new market segment that hedges future losses in the PND market. Garmin ($GRMN) shares took a hit yesterday after Dutch rival

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