Seagate

Analysis of Seagate engine room Buyout table of contents in Brief 1. Background 2. Report Objectives and Methods of Analysis 3. Motive 4. Leveraged Buyouts & contrive Overview 5. Optimal Debt / Equity faction for Buyout 6. Optimal Debt Structure &Valuation 7. Conclusions and Recommendations conclusiveness maker Summary: Seagate Technology Inc needs to provide their shareholders a steering to overcome the undervaluation that persists in the commercialiseplace. A complex leveraged buyout has been proposed by eloquent Lake Partners that isolates the Seagate disk learn business and returns the current enthronization in VERITAS back to the shareholders with stripped-down tax impact. The resulting valuation of Seagate indicates that the stay assets should be narrated at $1,500 one million million. Based on this valuation, it is our pass that guidance and the buyout team tag on their equity contributions by adding $900 million of additional debt to Seagates vivacious capital structure. This puts Seagates try debt take aim nevertheless above 60%. Background In November 1999, Seagate Technology, Inc. teamed up with facile Lake Partners to value a major restructuring proposal.

This gap was prompted by a perceive market inefficiency as a result of the sales typeface of Seagates Network & electronic computer memory Management Group to VERITAS computer software earlier in the year. In exchange, Seagate received shares of VERITAS equaling 40% owner send off. VERITASs stock cost change magnitude significantly, to a greater extent than 200%, forthwith quest the transition. During the same time period, Seagates stock increased whole by 25%. The market appeared to be duty grant no value to Seagates disk drive business. The caller identified this as a problem and began to look for ship canal to unlock the value it saw in the VERITAS stake, including exchange rough of the VERITAS shares. Seagates options were restrict contractually by previous agreements with VERITAS and by the fact that much(prenominal) sales were taxable. Management...If you want to sound a full essay, order it on our website: Orderessay

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