Team Project Description: Exploring Target Acquisitions

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Directions

You team works for XYZ Company, which has a directional strategy focused on expanding the company through horizontal integration. Your team can determine the official name of the company and industry. The company does a great job keeping close watch on its cash position and consistently maintains a positive cash flow; is very solvent; controls its overhead expenses; has solid marketing and sales, production, and human resources performance metrics, and fosters a culture of strategic thinkers. Historically, your company has expanded through a combination of organic $($new startups$)$ and inorganic growth and feels it$$s time to consider acquisition opportunities.

The Board is looking to engage in a friendly acquisition of a company that will not only increase its market share, but allow it to penetrate new markets and increase the company$$s abilities to meet current and future consumer needs and expectations. Since management$$s attitude is to pursue a friendly acquisition as opposed to a hostile takeover, your team may consider looking at conglomerates that have experienced significant growth through inorganic growth $($acquisitions$)$ and may now be looking to refocus on their core business and are willing to consider divesting some of its businesses that are within your industry. There could be other companies that are under financial duress and receptive to acquisition offers. Your team is a part of the corporate mergers and acquisition $($M&A$)$ department and has been assigned the task of identifying two potential acquisition targets. Since your Board is committed to a strategy of horizontal integration, you will be looking for possible acquisitions from within your industry. You are aware that the Board strategizes and supports green technology in companies that are guided by core values. You will be performing a preliminary analysis of the companies under consideration, and then ultimately recommend one of the companies move forward for a more in$-$depth valuation by the M&A Department.

Reminder: You are working as a team member who will either lead or follow during this Team Project. Check out the resources $($below$)$ to support your role during the Team Project.

Notes: The target acquisitions should be publicly traded and have the same fiscal year$-$end, preferably December $31$st$.$ In addition, your team is encouraged to select a proper name for your company and the industry for which it is aligned.

$1.$ Select Comparable Companies

Describe the methodology used to select the target acquisitions. You may want to consider utilizing the North American Industry Classification System $($NAICS$)$ to identify companies within your industry. Of course, there are a variety of Internet sites that can assist you in locating firms within your chosen industry, such as Google Finance and$$Yahoo$$Finance$.$