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  • Topic: Group, Timken Company, Transition metal
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  • Published : October 14, 2011
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Case 13: The Timken Company Student Presentations – November 15, 2011 Participating groups: Sections 1 and 2 Section 1 Presentation groups Group 11 Group 12 Questioning groups Group 5 Group 13 Evaluating Groups Group 10 Group 1 Deadline for electronic submission of presentation slides and case reports Nov 14, 1:00 pm Deadline for electronic submission of questions Nov 15, 8:00 am

Section 2
Presentation groups Group 11 Group 12 Questioning groups Group 5 Group 6 Evaluating Groups Group 10 Group 1 Deadline for electronic submission of presentation slides and case reports Nov 14, 1:00 pm Deadline for electronic submission of questions Nov 15, 8:00 am

Questions: 1. What are the key characteristics of the bearing industry? 2. How does Torrington fit with The Timken Company? What are the expected synergies? How important is Torrington to Timken? How motivated is Ingersoll-Rand to sell Torrington? 3. What is your stand-alone valuation of Torrington? Be prepared to explain and justify all the major assumption used in your estimate? 4. What is your with-synergies valuation of Torrington? Be prepared to explain and justify all the major assumptions used in your estimate. 5. Identify value drivers and conduct a sensitivity analysis of the respective valuations. 6. Should Timken be concerned about losing its investment grade rating? How do Timken’s financial ratios compare with those of other industrial firms in 2002? How would those ratios change if Timken borrowed $800 million, for example, to buy Torrington? 7. If Timken decides to go forward with the acquisition, how should Timken offer to structure the deals? Is Ingersoll-Rand likely to want a cash deal or a stock-for-stock deal? What are the risks for Ingersoll-Rand of accepting Timken shares for some or all of the consideration?

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