~ Case Analysis ~
I. PROBLEM STATEMENT
Ben and Jerry’s, founded in 1978, is a market leading distributor of super-premium ice creams, frozen yogurts, and sorbets, and has built a reputation on being a socially minded company. They were pioneers in the policy of “caring capitalism” and place heavy importance on the concept of social responsibility, a practice which many companies have since adopted. They have enjoyed long-term success as a result of their progressive methods of doing business and novel ideology regarding how a company should be ran. However, due to increased competitive pressure and declining financial performance, they have now been confronted by the threat of a takeover. Recently four companies’ submitted offers and management is in the process of carefully reviewing each of them. II. ALTERNATIVE SOLUTIONS CONSIDERED
1. Merge with Dreyer’s Grand Ice Cream at an offer price of $31 (stock) While Dreyer’s offer of $31 (stock) isn’t the highest of the four offers, there are many compelling incentives to consider. The company is most closely correlated with that of Ben & Jerry’s, as they are already in the business of selling premium ice cream and share the same market. Both companies also share similar social goals and are very active in the community. With the merger, Ben and Jerry’s would now have access to their vast distribution network and wealth of market knowledge resulting in an increase in sales and profits and a reduction in costs. Furthermore, Dreyer’s would operate Ben & Jerry’s as a quasi-autonomous business unit and maintain the current management team. While this would allow B & J to continue pursuing their corporate vision and not give up too much control in the process, this may not be the best idea as the management team is a large part of the reason they are in financial trouble in the first place. The major downside of this offer is that Dreyer’s is only offering $31, one of...