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Case Studies by Claudia Zeisberger

29 case studies

by Publication Date
published: 24 Apr 2015

  • Topic: Entrepreneurship
  • Industry: Textile
  • Region: Asia

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Abstract:
Emerging markets are challenging and require special expertise. India in particular is known to be a tricky business environment. The case follows two senior executives from Alvarez & Marsal’s India practice as they deal with an urgent request from one of their US private equity clients, Sapphire Capital. A former employee is claiming that irregular activities by senior management are at the root of the company’s financial difficulties. The turnaround team needs to act quickly yet must tread carefully in case the accusations prove unfounded. The second part of the case describes how the A&M team deals with the situation and the action they take to restore and restructure the ailing Indian company.

Pedagogical Objectives:
When times are good, (almost) anyone can lead; it is leading at difficult times that separates the wheat from the chaff. This case provides the opportunity for professionals to try their hand at a challenging turnaround situation in which financial distress is exacerbated by allegations of fraud. Add India, the setting, to the mix and it could be described as a 'perfect storm'.

Keywords:
Turnaround, Textile, Cash Flow Management, Emerging Markets, Corporate Governance, India, Distressed Companies, Fraud, Corporate Governance, Investors, Stakeholders and Accountability

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published: 24 Apr 2015

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Abstract:
Emerging markets are challenging and require special expertise. India in particular is known to be a tricky business environment. The case follows two senior executives from Alvarez & Marsal’s India practice as they deal with an urgent request from one of their US private equity clients, Sapphire Capital. A former employee is claiming that irregular activities by senior management are at the root of the company’s financial difficulties. The turnaround team needs to act quickly yet must tread carefully in case the accusations prove unfounded. The second part of the case describes how the A&M team deals with the situation and the action they take to restore and restructure the ailing Indian company.

Pedagogical Objectives:
When times are good, (almost) anyone can lead; it is leading at difficult times that separates the wheat from the chaff. This case provides the opportunity for professionals to try their hand at a challenging turnaround situation in which financial distress is exacerbated by allegations of fraud. Add India, the setting, to the mix and it could be described as a 'perfect storm'.

Keywords:
Turnaround, Textile, Cash Flow Management, Emerging Markets, Corporate Governance, India, Distressed Companies, Fraud, Corporate Governance, Investors, Stakeholders and Accountability, Gpei, Gpei-Case

Prizes won:
- Winner 2015 EFMD Case Writing Competition, Indian Management Issues and Opportunities Category

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published: 24 Mar 2014

  • Topic: Economics & Finance
  • Industry: Banking and Finance
  • Region: Global

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Abstract:
In the spring of 2011, JPMorgan Chase realised that their synthetic credit portfolio (SCP), which represented less than 1% of the bank’s total assets, had grown to become more than half of the bank’s total risk. An article in the WSJ would soon make it public knowledge that the bank was in a difficult situation. How could an institution known for its diligence, which had survived the global financial crisis, and was led by a highly respected CEO (Jamie Dimon), end up in such dire straits?

Pedagogical Objectives:
Having cultivated a reputation for sound risk management and business decision making, the 'London Whale' episode raises the following question around JP Morgan's internal controls: Why did standard market risk management practices for financial institutions, such as Value-at-Risk (VaR), not prevent such an extraordinary loss, and where did the process fail? In addition, the soon-to-be published Case (B) will explore the effectiveness of the indictments and penalties handed out by the US courts by the summer of 2013. Will they have any impact on risk-taking by financial institutions? The case offers a backdrop for a discussion on the effectiveness of regulations.

Keywords:
Risk Management, Market Risk, Portfolio Management, Chief Investment Officer (cio), Business Decision Making, Value-At-Risk (var), Credit Risk, Financial Regulation, Corporate Governance, Case Studies: Value Creation, Strategy and Implementation

published: 24 Mar 2014

  • Topic: Entrepreneurship
  • Industry: Activities of venture and development capital companies
  • Region: Other Regions

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Abstract:
Duxton Asset Management, a specialist agro-business investor, is evaluating an investment in rice farming in Tanzania, Africa. Duxton has a business strategy of investing in operating farmland assets, many of which are in developing or even frontier markets. The case discusses the complexities of investing in an atypical multidimensional asset.

Pedagogical Objectives:
To examine the potential risks and rewards of a farmland investment with strong potential ESG impact in a frontier country. To present a strategically relevant question on the immediate actions available to the asset manager upon a change in circumstances on the financing side. To assess the implications of this decision on the business and operating strategy.

Keywords:
Private Equity, Africa, Agriculture, Responsible Investing, Impact Investing, Growth Capital, Farmland, Frontier Markets, Gpei, Gpei-Case

published: 24 Jun 2013

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Abstract:
The case traces the evolution of the private equity investment platform of the Ontario Teachers’ Pension Plan (Teachers’). Unlike the typical traditional pension fund, Teachers’ has forged a bold, pioneering approach to investing by making a concerted push towards direct investing. The case discusses the trade-offs involved in developing a direct investing platform.

Pedagogical Objectives:
The case discusses the advantages and limitations of the direct investing model, contrasts it with other approaches to investing in private equity, and raises important issues for institutional investors pursuing strong risk-adjusted returns. It requires students to think about the many challenges that arise in building and managing a comprehensive private equity programme.

Keywords:
Private Equity, Pension Fund, Limited Partner (lp), Buy-Out, Bce, Direct Investing, Ontario Teachers' Pension Plan, Co-Investment, Iaf, Gpei, Gpei-Case

published: 24 Jun 2013

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Abstract:
In 2011, Carlyle is considering an exit from its investment in the European fashion brand Moncler, in which it holds a minority stake. The case focuses on the complexities of preparing and executing an exit under rapidly changing market conditions taking varied interests and potential outcomes into consideration.

Pedagogical Objectives:
To evaluate various exit options for a PE firm and discuss how optionality and negotiation leverage in a sales process can be created and maintained. To demonstrate how PE firms make decisions under uncertainty and time constraints taking a variety of financial and non-financial factors into account.

Keywords:
Private Equity, Exit, Ipo, Dual Track, Buy-Out, Minority, Carlyle, Moncler, Gpei, Gpei-Case

published: 27 Mar 2012

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Abstract:
A consortium of private equity firms (KKR and Silver Lake Partners) is in the process of acquiring the semi-conductor division of Agilent. To prepare for the signing of the acquisition agreement and the subsequent transfer of ownership, the deal team is revisiting their investment thesis with respect to upsides and risks.

Pedagogical Objectives:
To develop a high-level understanding of the workings of leveraged buy-outs. To discuss the risk- return relationship in PE and the interplay of financial and operational risks in the deal structuring process. To understand the trade-offs involved in different debt instruments and financing structures.

Keywords:
Private Equity, Buy-Out, Kkr, Silver Lake Partners, Semiconductors, Financing, Risk, Avago Technologies, Corporate Governance, Auditing, Risk Control and Performance, Gpei, Gpei-Case

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published: 31 Jan 2012

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Abstract:
A consortium of private equity firms (KKR and Silver Lake Partners) is in the process of acquiring the semi-conductor division of Agilent. To prepare for the signing of the acquisition agreement and the subsequent transfer of ownership, the deal team is revisiting their investment thesis with respect to upsides and risks.

Pedagogical Objectives:
To explore the complexities of a typical buy-out situation from the operational side. Specifically, what are the highest impact value creation levers and biggest risks, and how to mitigate them. To discuss why Agilent wanted to sell the business and why PE firms might be a better owner at the time of the transaction.

Keywords:
Private Equity, Buyout, Kkr, Silver Lake Partners, Semiconductors, Due Diligence, Risk, Avago Technologies, Corporate Governance, Auditing, Risk Control and Performance, Gpei, Gpei-Case

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published: 25 May 2011

  • Topic: Entrepreneurship
  • Region: Global

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Abstract:
The topic of valuation and measurement of return (i.e. investment success) permeates the whole life cycle of private equity (PE). While the valuation part is in many ways similar to other direct investment strategies, the measuring of returns in private equity is a notoriously difficult business, mainly due to the absence of an efficient and transparent market for the asset class. So while theoretically not difficult, the wide range of practical approaches – often designed to produce a specific outcome – tend to be confusing to an outsider or new student of the field. This paper does not attempt to systematically explore all the variations that exist in the market but rather to give an overview of the most common approaches, highlighting their strengths and weaknesses and pointing to major alternative methods.

Pedagogical Objectives:
see abstract

Keywords:
Private Equity, Valuation Issues, Return Measurements, Portfolio Companies, Acquisition Targets, Iaf Gpei, Corporate Governance, Investors, Stakeholders and Accountability, Investors, Stakeholders and Accountability, Gpei, Gpei-Case

published: 26 Jul 2010

  • Topic: Entrepreneurship
  • Industry: Private Equity and Family Offices
  • Region: Global

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Abstract:
A European multi-family office is weighing whether and how to invest in Asian private equity. Part A moves from a discussion of the historical and current state of Asian private equity to the outlook and risks associated with such an investment. It also starts a discussion of returns on Asian private equity and whether they adequately compensate for the risks identified earlier. Part B deals with implementation questions on how to execute an investment strategy in this market from an asset manager perspective. It follows up on the returns discussion from Part A, focussing on the top performing funds and how to identify and access them.

Pedagogical Objectives:
1.To get an overview of the Asian private equity landscape in respect of its development, size and growth prospects 2.To understand private equity as an asset class a.with regard to the relationship between LPs and GPs b.with regard to opportunities/risks and returns c.To discuss similarities and differences between PE in Asia and developed markets and what they mean for expectations of returns.

Keywords:
Private Equity Returns in Asia, Lps and Gps, Investing in Emerging Markets, Growth Drivers in Asian Pe, Target Returns in Private Equity, Private Equity in Emerging Markets, Risk-Adjusted Returns in Emerging Markets, Gpei, Gpei-Case

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