palamon capital evaluation
Section 005 #2
Blaze Cohen
Finance Capstone
Individual Executive Summary
11/10/13
Evaluating and Acquiring TeamSystem S.p.A.
Private equity firm, Palamon Capital specializes in managing, funding, and developing small to mid-sized companies into public ownership. Palamon’s strategy is to buy a controlling stake in an up and coming company for 10 – 50 million EUROS grow the business, and implement an exit strategy. As the private equity market in Europe becomes more cut- throat and competitive, Palamon Capital, a private equity company Based in the UK is looking to diversify and expand its assets from focusing solely on the UK markets to focusing on the European markets as a whole. As a part of this expansion and diversification plan, Palamon Capital expects to purchase a controlling stake in an Italian software company, TeamSystem S.p.A.. After analyzing TeamSystem S.p.A.’s financial statements and cash flows, going fourth with the controlling investment is a great opportunity for Palamon Capital as a company in order to expand westward into Europe. Not only is it a great growth opportunity, but Palamon Capital is getting great value for their money. After following all the investment procedures, Palamon Capital should proceed with the investment and pay 25.9 million EUROS for their 51% controlling stake in TeamSystem S.p.A.. After finalizing the transaction, the current market value for TeamSystem S.p.A. will be 65.84 million Euros, with Palamon Capitals controlling stake worth 33.58 million Euros (shown in exhibit 1).
After analyzing the financial data, and using a discounted cash flow valuation (Shown in Exhibit 2 of the Appendix) purchasing a 51% controlling stake in TeamSystem S.p.A. for 25.9 million EUROS is a great opportunity for quick growth in this competitive market. TeamSystem S.p.A. is a very attractive investment because Palamon Capital is getting great value for their money. Palamon Capital is buying 51% of team systems for only 25.9
Blaze Cohen
Finance Capstone
Individual Executive Summary
11/10/13
Evaluating and Acquiring TeamSystem S.p.A.
Private equity firm, Palamon Capital specializes in managing, funding, and developing small to mid-sized companies into public ownership. Palamon’s strategy is to buy a controlling stake in an up and coming company for 10 – 50 million EUROS grow the business, and implement an exit strategy. As the private equity market in Europe becomes more cut- throat and competitive, Palamon Capital, a private equity company Based in the UK is looking to diversify and expand its assets from focusing solely on the UK markets to focusing on the European markets as a whole. As a part of this expansion and diversification plan, Palamon Capital expects to purchase a controlling stake in an Italian software company, TeamSystem S.p.A.. After analyzing TeamSystem S.p.A.’s financial statements and cash flows, going fourth with the controlling investment is a great opportunity for Palamon Capital as a company in order to expand westward into Europe. Not only is it a great growth opportunity, but Palamon Capital is getting great value for their money. After following all the investment procedures, Palamon Capital should proceed with the investment and pay 25.9 million EUROS for their 51% controlling stake in TeamSystem S.p.A.. After finalizing the transaction, the current market value for TeamSystem S.p.A. will be 65.84 million Euros, with Palamon Capitals controlling stake worth 33.58 million Euros (shown in exhibit 1).
After analyzing the financial data, and using a discounted cash flow valuation (Shown in Exhibit 2 of the Appendix) purchasing a 51% controlling stake in TeamSystem S.p.A. for 25.9 million EUROS is a great opportunity for quick growth in this competitive market. TeamSystem S.p.A. is a very attractive investment because Palamon Capital is getting great value for their money. Palamon Capital is buying 51% of team systems for only 25.9