HARVARD BUSINESS SCHOOL CASES

Burton Sensors, Inc.

  • William E. Fruhan and Wei Wang, Burton Sensors, Inc. HBS Brief Case #918-539, June 2018.

  • William E. Fruhan and Wei Wang, Burton Sensors, Inc. Teaching Notes, HBS Teaching Note #918-540, June 2018.

  • William E. Fruhan and Wei Wang, Burton Sensors, Inc. Spreadsheet for Students, HBS Spreadsheet Supplement #918-541, June 2018.

  • William E. Fruhan and Wei Wang, Burton Sensors, Inc. Spreadsheet for Instructors, HBS Spreadsheet Supplement #918-542, June 2018.

 

Case description

Burton Sensors presents a realistic situation where a small, rapidly growing, and profitable temperature sensor original equipment manufacturer (OEM) reaches its debt capacity and seeks equity financing to sustain high growth. The president of the company must decide whether to purchase thermowell machines (a positive NPV project), whether to issue common stock to a private investor at depressed prices to alleviate financial pressure, and whether to acquire another sensor manufacturer in an all-stock deal. All three decisions are interrelated and require different techniques to assess. In particular, the acquisition decision must be analyzed as both an investment and a financing opportunity, as the acquisition could be used to resolve the financial constraint problem. This case thus shows students how corporate investment and financing decisions often interact. The case offers a comprehensive overview of key issues in a typical corporate finance or financial management course, including capital budgeting, debt capacity analysis, security issuance, and acquisitions. It can be used in a first-year MBA course in corporate finance or financial strategy or in an elective MBA course in mergers and acquisitions. It can also be used in upper-year undergraduate finance courses that cover capital budgeting, security issuance, and mergers and acquisitions. The case can also be used as a take-home final exam.

Pinewood Mobile Homes

  • William E. Fruhan and Wei Wang, Pinewood Mobile Homes, HBS Brief Case #915-547, March 2015.

  • William E. Fruhan and Wei Wang, Pinewood Mobile Homess,Teaching Notes, HBS Teaching Note #915-548, March 2015.

  • William E. Fruhan and Wei Wang, Pinewood Mobile Homes, Spreadsheet for Students, HBS Spreadsheet Supplement #915-549, March 2015.

  • William E. Fruhan and Wei Wang, Pinewood Mobile Homes, Spreadsheet for Instructors, HBS Spreadsheet Supplement #915-550, March 2015.

 

Case description

This case presents a realistic situation in which a firm in financial distress attempts an out-of-court financial restructuring by means of a debt exchange. Pinewood Mobile Homes is a large manufacturer of prefabricated homes, producing one-story, ranch-style houses; two-story, single section and Cape Cod modular homes; and townhomes, apartments and duplexes. The company has lost the ability to compete effectively in the market place because it borrowed and acquired aggressively prior to the housing market crash. In order to avoid filling for Chapter 11 bankruptcy, Pinewood Mobile Homes must receive consent form senior lenders, junior creditors, and shareholders for a comprehensive restructuring plan. This case is written for use in elective MBA courses in corporate restructuring or advanced corporate finance. It can also be used in upper-level undergraduate finance courses that cover financial restructuring and corporate valuation.

Landmark Facility Solutions

  • William E. Fruhan and Wei Wang, Landmark Facility Solutions, HBS Brief Case #915-527, September 2014.

  • William E. Fruhan and Wei Wang, Landmark Facility Solutions, Teaching Notes, HBS Teaching Note #915-528, September 2014.

  • William E. Fruhan and Wei Wang, Landmark Facility Solutions, Spreadsheet for Students, HBS Spreadsheet Supplement #915-529, September 2014.

  • William E. Fruhan and Wei Wang, Landmark Facility Solutions, Spreadsheet for Instructors, HBS Spreadsheet Supplement #915-530, September 2014.

 

Case description

Landmark Facility Solutions presents a situation in which a medium-sized facility management company assesses whether to acquire a larger facility management company that is known for its high-quality services and technical expertise. The acquirer believes the acquisition will help it to become an integrated facility manager and enter new industries in its home market. The case focuses on valuing the acquisition opportunity and choosing the right financing for the transaction. It explores the interaction between corporate investment and financing, and sets the stage for discussions about capital structure decisions. The case can be used in first-year MBA courses in corporate finance and financial strategy or second-year MBA courses in mergers and acquisitions and advanced corporate finance. It also can be used in an undergraduate finance course that covers mergers and acquisitions.

Paramount Equipment

  • Carliss Y. Baldwin and Wei Wang, Paramount Equipment, HBS Brief Case #914-557, July 2014.

  • Carliss Y. Baldwin and Wei Wang, Paramount Equipment, Teaching Notes, HBS Teaching Note #914-558, July 2014.

  • Carliss Y. Baldwin and Wei Wang, Paramount Equipment, Spreadsheet for Students, HBS Spreadsheet Supplement #914-559, July 2014.

  • Carliss Y. Baldwin and Wei Wang, Paramount Equipment, Spreadsheet for Instructors, HBS Spreadsheet Supplement #914-560, July 2014.

 

Case description

Paramount Equipment, Inc., based in Fort Wayne, Indiana, is a large manufacturer of cranes and compact construction equipment, aerial work platforms, and food service equipment. Founded in 1987, Paramount now had manufacturing operations in 24 countries. However, it lost its competitive position because it took on too much debt in the form of bank borrowings relative to the risk level of its business. Now the company must seek funding and guarantees in order to restructure its debt. Paramount's future depends on whether existing lenders, management, and the government of Ontario-where the company employs more than 7,000-can reach a feasible restructuring and refinancing plan fast and whether Paramount was able to secure a capital injection from new investors. Students must determine the optimal capital structure policy consistent with competitive risks and assess available tools for financing a company in financial distress. The case requires students to perform only limited quantitative analysis and is ideal for use in first-year MBA courses in financial strategy or corporate finance. It would also work well in advanced undergraduate finance courses that cover capital structure and financial distress.

Newfield Energy

  • William E. Fruhan and Wei Wang, Newfield Energy, HBS Brief Case #914-541, February 2014.

  • William E. Fruhan and Wei Wang, Newfield Energy, Teaching Notes, HBS Teaching Note #914-542, February 2014.

  • William E. Fruhan and Wei Wang, Newfield Energy, Spreadsheet for Students, HBS Spreadsheet Supplement #914-543, February 2014.

  • William E. Fruhan and Wei Wang, Newfield Energy, Spreadsheet for Instructors, HBS Spreadsheet Supplement #914-544, February 2014.

 

Case description

In September 2013, Miles Griffin, CEO and chairman of the board of Newfield Energy, prepares to present financial proposals to the board of directors for approval. Newfield (based in Houston, Texas) was a large independent energy company primarily engaged in the exploration, development, and production of crude oil, natural gas, and natural gas liquids. It had experienced declines in earnings and cash flows in recent years because of the decline of natural gas prices and asset write-downs. The proposals to the board, prepared by the CFO, included (1) a press release outlining that the company was planning to divest several natural gas projects immediately, probably at significant book losses; (2) a significant reduction of common stock dividends; and (3) an exchange offer under which the company would exchange up to 20% of its common stocks into newly issued preferred stocks. Griffin was concerned that the breadth and complexity of the proposals might cause investors to worry. This case is ideal for use in first- or second-year MBA courses in corporate finance or capital markets or in a finance course for advanced undergraduates.

Jackson Automotive Systems

  • William E. Fruhan and Wei Wang, Jackson Automotive Systems, HBS Brief Case #914-505, July 2013.

  • William E. Fruhan and Wei Wang, Jackson Automotive Systems, Teaching Notes, HBS Teaching Note #914-506, July 2013

  • William E. Fruhan and Wei Wang, Jackson Automotive Systems, Spreadsheet for Students, HBS Spreadsheet Supplement #914-507, July 2013

  • William E. Fruhan and Wei Wang, Jackson Automotive Systems, Spreadsheet for Instructors, HBS Spreadsheet Supplement #914-508, July 2013

 

Case description

Jackson Automotive Systems produces automotive parts for advanced heating and air conditioning systems, engine cooling systems, fuel injection and transfer systems, and various other engine parts and it supplies them to the automotive industry primarily in Michigan. Like many OEM suppliers for the automotive industry, Jackson cut back production following the financial crisis in 2008. By 2013, the firm is back to operating at capacity. The company experiences a bottleneck in production of some key electronic components and, as a result, is unable to repay its outstanding debt to the bank. In addition, the firm delayed replacing equipment during the downturn and now must replace aging equipment to avoid future production delays. The president approaches the bank for an extension to repay a loan and for an additional loan to cover the new equipment purchase. Before meeting with the loan committee, the president must prepare a presentation on the firm's financial position.

New Earth Mining, Inc.

  • William E. Fruhan and Wei Wang, New Earth Mining, Inc., HBS Brief Case #913-548, March 2013.

  • William E. Fruhan and Wei Wang, New Earth Mining, Inc., Teaching Notes, HBS Teaching Note #913-549, March 2013

  • William E. Fruhan and Wei Wang, New Earth Mining, Inc., Spreadsheet for Students, HBS Spreadsheet Supplement #913-550, March 2013

  • William E. Fruhan and Wei Wang, New Earth Mining, Inc., Spreadsheet for Instructors, HBS Spreadsheet Supplement #913-551, March 2013

 

Case description

New Earth Mining is one of the largest producers of precious metals in the U.S. While the firm operates mines primarily in the U.S. and Canada, it has also made substantial investments in gold exploration projects in Australia and Chile. New Earth has been very successful and has a large amount of cash on the balance sheet, a simple debt structure, and a reasonable leverage ratio with no risk of liquidity. With a strong financial position, the firm considers reducing its dependence on precious metals by diversifying into base metals and other minerals. An investment opportunity for mining iron ore in South Africa looks promising but still carries substantial risk. A high risk of civil war in neighboring countries along with strong fears that the South African government will nationalize mining operations combine to create an unstable political environment. The tentative financing package is complex and creates challenges for determining a value for the project. Students must complete a quantitative analysis of 4 proposals with different valuation methods before making a final recommendation.

Polar Sports, Inc.

  • W. Carl Kester and Wei Wang, Polar Sports, Inc., HBS Brief Case #913-513, August 2012.

  • W. Carl Kester and Wei Wang, Polar Sports, Inc., Teaching Notes, HBS Teaching Note #913-514, August 2012.

  • W. Carl Kester and Wei Wang, Polar Sports, Inc., Spreadsheet for Students, HBS Spreadsheet Supplement # 913-515, August 2012.

  • W. Carl Kester and Wei Wang, Polar Sports, Inc., Spreadsheet for Instructors, HBS Spreadsheet Supplement #913-516, August 2012.

 

Case description

Polar Sports, Inc. is a fashion skiwear manufacturing company in Littleton, Colorado. The company has a unique design for skiwear using a special synthetic material that improves insulation and durability. The ski apparel industry is highly competitive and the best way for companies to gain market share is by developing new fabrics and using innovative patterns. The firm generates over 80% of sales between September and January and relies on seasonal production to respond promptly to customer orders. During those months, the plant must rapidly increase production by hiring and training additional workers, often paying them overtime. The vice president of operations is concerned about the costs associated with seasonal production and presents a proposal to switch to level production. The change can reduce costs and improve efficiency but can also affect other aspects of company finance. Students must analyze potential cost savings and understand the financial risks involved before making a final recommendation. This case can be used in first-year MBA-level courses in finance or in advanced undergraduate finance courses.

Smith School of Business, Queen's University

© 2019 Wei Wang

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