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one of the largest cable operators in the U.S., prepared to acquire the AirThread. Connections (ATC), a large regional cellular provider. Although this acquisition. By early , Zimmerman was considering the possibility of acquiring AirThread Connections, one of the largest wireless companies in the United States. This case can be used as a capstone valuation exercise for first-year MBA students in an introductory finance course. A senior associate in the business.

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Furthermore, the company believed that its core competency as an acquirer would continue to play a fundamental role in its future success.

AirThread Connections Case

airthreadd In order to move wireless traffic from a cell tower to a central switching office required either leasing telephone lines from the local carrier or investing in very expensive rP microwave transmission equipment, which was oftentimes technically difficult to employ due to line of site requirements.

About the authors Erik Stafford is John A. Gains Losses on Investments This publication may not be digitized, photocopied, or otherwise reproduced, posted, or transmitted, without the permission of Harvard Business School. This discount is primarily related to the illiquidity of private investments, but also considers certain types of agency costs as well as the financial health and size of the firm.

Valuation of AirThread Connections

Valuation of AirThread op Given the potential importance and complexity of a possible AirThread acquisition, Zimmerman decided to tap Jennifer Zhang, an up-and-coming senior associate from the University of Chicago, to conduct the initial valuation of AirThread. Finally, we get the WACC, which is 9. The increased size would not only help insure that ACC would remain a viable industry player but would also help improve profitability through better network utilization.


Heilprin Teaching note for case It offered services in more than markets across five geographic regions. Cite View Details Purchase Related. We choose to change the WACC and growth rate to achieve this because we airrthread those variables are most important.

Hi, I am Sara from Studymoose Hi there, would you like to get such a paper? The potential synergies come from system operating cost saving as well as the increase in revenue and gross profit. Cite View Details Read Now.

In addition, AirThread had an extensive set of roaming agreements with other carriers to provide its customers with coverage in areas where the company did not operate a network. To order copies or request permission to reproduce materials, callwrite Harvard Business Publishing, Boston, MAor go to http: Based on the projected cash flow information provided in the case, what is the stand- alone value of AirThread?

In contemplating this issue Jennifer believed that it may be necessary connecions follow the customary practice of employing a private company discount.

Help Center Find new research papers in: Operating Results As a starting point, Jennifer decided to create a base case using historical operating results as a guide, and then create an upside case that considered possible synergies. Heilprin Erik and Joel explain what winning this award means and offer some case writing advice. Second, the acquisition could help both companies expand into the business market.


Valuation of AirThread Connection by Ivan Ng on Prezi

Juliane Begenau and Erik Stafford. This presented two problems. The case includes two interesting characters — Zimmerman and Zhang, but contention among the characters is not the primary aim of the case.

By continuing to use our site you consent to the use of cookies as described in our privacy policy unless you have disabled them. Accounts receivable is based on total revenue. Valuation of AirThread Connections. Next, we use the market multiple approach to calculate the non-operating value part.

Valuation of AirThread Connections Essay

In fact, some had argued that the company needed to find a suitor before its market position became untenable. As an additional assignment, instructors can require students to consider the personal tax disadvantage of debt as connextions as the synergies American Cable expects to achieve following the acquisition. Go to advanced search. Click to learn more https: American Cable currently offered video, internet, and landline telephony, but did not have any kind of wireless offerings.