Mercury Athletics Footwear: Corporate Valuation

Mercury Athletics Footwear: Corporate Valuation Essay example
Masters
Essay
Finance & Accounting
Pages 6 (1506 words)
Download 0
Mercury Athletics Footwear: Corporate Valuation Name Course Course Instructor Date Introduction Following the information provided in the case study, here is the calculation of the value of Mercury Athletic Footwear as an independent firm using the free cash flow method…

Introduction

0 76,566.00 Less 40% Cost Saving (Tax) 18,802.00 21,214.40 23,042.00 24,674.40 25,844.80 Capital Expenditure 11,983.00 12,226.00 13,303.00 14,258.00 14,943.00 Changes in working capital 4,569.00 2,648.00 9,805.00 8,687.00 6,234.00 Net Cash Flow 21,238.00 26,728.60 22,098.00 25,472.60 29,544.20 Terminal value Discount Factor 12% Growth rate (2%) Present Value of Net Cash Flow $18,963 $21,308 $15,729 $16,188 $16,764 Present Value of All Cash Flows (A) $88,952 Terminal Value: 2012 Net Cash Flow $30,135 2011 Present Value $301,351 2007 Present Value (B) $170,995 Value of Mercury = A+B $259,946         Considering Mercury from 2007–2011, there is growth in earnings and using the free cash flow method it is evident that the Net profit value is positive. Additionally, acquiring Mercury may lead to large market share which may eventually result into huge revenue. ...
Download paper
Not exactly what you need?

Related papers

Commercial Logic of Acquiring Mandrake Footwear
The decision to make acquisitions is taken by several companies in many parts of the world every now and then. Some of these decisions eventually proof to be vital and profitable while others turn out to be wrong decisions because they result in losses (Olsson, 2001). Fundamentally, the prediction as to whether or not a particular acquisition would be beneficial depends on a number of factors.…
Executive summary for Corporate Finance Valuation
This is because it gives clear information on the return on investment and the shareholders value that is payable to investors. The analysis focuses on Balfour Beatty Corporation that is a high rank engineering company with global presence. The company provides a wide range of products and services with an aim of meeting its shareholders and customer needs promptly. This report provides an…
Valuation
In 2011, Coca-Cola was also recognized as the most valuable brand in the world on the basis of Interbrand’s best global brand. Pepsi Corporation Pepsi Corporation is another American based multinational enterprise that operates in the food and beverage industry. Headquarter of Pepsi is in Purchase, New York. The company was formed in 1965 and since that time it has expanded its brands to more…
New Slide Footwear Company
These are classified as fixed and variable cost: Where, fixed costs are those that remain constant regardless of production, while variable costs will vary with the production (Khan & Jain, 2008; Peavler, 2011). In practice, we have established all the fixed cost as rent and maintenance, while variable costs as wages, materials, utilities and other expenses. This will ensure that we make accurate…
Corporate Valuation, Capital Structure and Dividend policy.
News Corporation is one of the top television groups in the world. Its business includes the best broadcasting company of United States called Fox Broadcasting Company. News Corporation’s cable network programming segment produces and issues licenses for programming to be broadcast on satellite. In addition to this News Corporation is one of the best motion picture producers. Fox Filmed…
Mercury Athletic Footwear Case Study: Corporate Valuation
So John Liedtke would have to be very careful and strategic in his negotiation. This is a company whose growth has been faltering at best and there would be need to not only redesign but to totally restructure it in order to ensure that the expected profitability is achieved. So the negotiating tactic would involve pointing out the reasons that led to the disappointing performance of Mercury and…
Valuation Financial statement analysis
The company manufactures and distributes different brands specializing in consumer products including hygiene, nutritional and personal care products. Further, its portfolio has items such as Lipton, Knorr, Magnum, Hellmann’s, Lux, Dove, Omo and Axe. Notably, the company product retails in more than 170 countries around the globe.