Bidding on the Yell Group
1. Introduction
Yell Group consists of two businesses that are operating across countries. Yellow Page is a classified directory business in the UK, while Yellow Book is an independent directory business in the USA. These businesses are currently owned by British Telecom which is under pressure to reduce its heavy debt load and had been wavering for months about the future of these two Yellow Pages divisions. Apax Partner and Hick Muse are two private equity firms that are interested in the acquisition of the Yell Group by using debt for a majority of the purchase price and equity for the remainder. The deal is crucially important to both Apax and Hicks Muse because of its high visibility — simply by
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The U.K. business is subject to heavy regulation which will restrict the price. Thus the only way to expand profits is through the advertisement volume. Unfortunately, the growth in the classified directories advertising market has been declining over the last few decades and will probably continue in this tendency even though the total advertising market has seen increasing growth. The potential good opportunities for this business could be the additional divisions that BT Yellow Pages owned. Prospective investment indicated these businesses are in the early stages. The U.S. market is an important source of new business for SMEs throughout the country and the independents are projected to increase their market share from 11% to 30% over the 2000 — 2005 period. For Yellow Book, this growth is to be fueled by expansion efforts as launching new directories into contiguous markets and launching wide area books into cities without an independent presence. In terms of the industry life cycle, BT Yellow Pages is most likely in the late maturity / early decline stage while Yellow Pages USA was still in the growth phase. These factors combined with the buyers’ investment horizon will influence their exit strategy.
Yell Group Ltd. provided Apax and Hicks Muse team with projections for both BT Yellow Pages and Yellow Book USA based on what a potential growth in the upcoming years. Since Yell is trying to sell their
BBBY faces both external / internal potential problems while it tactics to implement its expansion plan.
In contrast to Borders Group, Barnes & Noble which is a leading bookstore in the US recorded an 11% increase in their share value in the past year with the introduction of their e-book reader “Nook”. It is clear that Barnes & Noble were not “Myopic” in their approach and were able to retain and even grow their customers as well as profits by embracing a new product.
The bookstore chain has been decreasing in profit in the US over the past 20 years. Most of the books retailers are shutting down their operations and only a few are still operating in the country. Barnes and Noble has become the largest bookseller in the book retailers industry. The firm has integrated its business philosophy into web presence though eBook marketplace. This business strategy assisted the firm to be able to reach a large scale customers and remain as a strongest competitor in the book retailing market.
Strategic planning is a critical element of an organization’s annual business plan. A strategic plan consists of a number of components. In addition to analyzing a company’s strengths and weaknesses, a strategic plan also includes implementation and control techniques. While this may seem easy enough, implementing a strategic plan into an organization can be challenging. Barnes and Noble, like a number of corporations are seeking ways to improve productivity and profitability. This essay will identify business alternatives for the bookseller which will enable them to diversify their product offerings.
Before publishing its annual Yellow Pages telephone directory, GTE Hawaiian Telephone Company (GTE) contacts all clients who had advertised in its previous year 's directory if they want to revise their advertisements or the status for the following year. Because the catering services of "Iva 's Complete Katering" had been advertised in GTE 's Yellow Pages for the previous five years, Iva, the
An exchange of Web links opens up McBride Financial to the world of viral marketing and exposes them to search engines, meaning a greater potential for someone on the Internet to find McBride Financial Services. In the last decade, more homebuyers have found their new home online. In a study done by the National Association of Realtors (NAR) in 2008, 35% more people used the Internet to find a new home versus using a newspaper (WB3). In respect to the research done by NAR, it is suggested that McBride Financial Services should consider expanding their presence on the Internet elevating their exposure to the target market and expanding their marketing niche.
As BT becomes rather large, BBD might be at risk as the business is contra-cyclical and thus vulnerable for external uncontrollable influences
I agree with you that assessments in a group is essential to understand the functioning of the group members. Also, I believe that it is important to assess individual members as well as the group as a whole. As a group facilitator we must constantly gather pertinent information that will be used to achieve the individuals and groups goals. Assessing the group helps to make the group more cohesive and beneficially to the members. You made a great point that understanding the characteristics of the group members can help improve group participation. I do believe that if a member is not participating does not mean that they are not benefiting from the group. Also, having a member that monopolize the group does not they are
* Buy-A-Lot Company – Astro should not recognize because it has no intention to sell and credit rating upgraded from BBB to BBB+.
BBBY will need to trade off business risk against financial risk. They operate in an industry with fairly low business risk however BBBY's operating leverage is high which could indicate a higher than industry business risk if they are not cognizant of managing their fixed costs. In addition, BBBY's debt to total asset ratio is higher than their industry. Both of these indicate a high business and financial risk. If BBBY were to recapitalize to 80% debt to total capital it would only increase their financial risk and reduce shareholders earnings per share. Therefore the recommendation for a capital structure for BBBY would be to add more than the 40% debt to total capital but not more than 80%.
This represents a 7% increase in stock price. Further, the additional leverage and return of excess cash to shareholders will significantly increase ROE. If the market determines that an 80% debt capital structure is feasible for BBBY, then we will expect further capital gains as investors applaud shareholder friendly policies and re-examine EPS estimates. However, if top line growth and same store sales growth continue to trend downward, investors may become skeptical of BBBY management’s ability to continue generating over 30% EPS growth, and thus question the ability of the company to service its debt in the future.
Barnes and Nobles is one of the biggest bookstores that has a brick-and-mortal store concept. In the past they were know as a “big bully” that drove small book stores to close down because of their aggressive tactics to have competetetive advantage over them. Nonetheless, with the evolving circle of technology they have had a hard time in keeping up with the E-book era. In 2014 E-books increased its reader subscription by 28% compared to 23% in 2013. This number will continue increasing because 50% off American’s have access to devices that are either an e-reader or a tablet. B&N changed its business model to adjust to this new setting before it suffered a
The book market is in fact growing with the exception of weak fortnights in both March and April, sales figures for the overall book market have shown sustained growth in 2005. ...
The main competitors of Harvey Norman Holding LTD is the group of J B HI-FI, who has declared a sales revenue from 2.73Bn to 2.96Bn as an increase of 8.3% (P.2, JB HI-FI annual report 2011), compares to the increase of 9% of Harvey Norman.According to the figure,it seems Harvey Norman is doing better than J B HI-FI, but the business segment for J B HI-FI is much less diversified than Harvey Norman, therefore, J B HI-FI is actually doing better in just viewing the computer and software segment.
Question 1 - Would you grant any of the special requests of the four expat candidates? Provide your rationale.