254830128 Group 4 Williams SFM
Contents
1) Evaluate the terms of the proposed $900 million financing from the perspective of both parties. How would you calculate the return to investors in this transaction? If you need more information, what information do you need? 2
Q2) What is the purpose of each of the terms of the proposed financing 3
Q3) Conduct an analysis of Williams’ sources and uses of funds during the first half of 2002. How do you expect these numbers to evolve over the second half of 2002? What is the problem facing Williams? How did it get into this situation? How has it tried to address the problem it is facing? 3
Q4)Some might describe Williams as “financially distressed.” What evidence is there that Williams’ business may be compromised as a result of its previous financial decisions? 5
Q5) “Tough times demand tough decisions.” As the CEO of Williams, would you recommend accepting the proposed $900 million financing offer? If not, what alternatives would you pursue? 6
PERCENTAGE CONTRIBUTION
Roll Number
Name(PGP/17/)
Percentage Contribution
Ankit Kumar
195
20%
R Gayathri
228
20%
Shraddha Shrikhande
240
20%
Surbhi Kothari
248
20%
Sandeep Bhat
290
20%
1) Evaluate the terms of the proposed $900 million financing from the perspective of both parties. How would you calculate the return to investors in this transaction? If you need more information, what information do you need?
Evaluation from Berkshire Hathaway and Lehmann Brother’s Perspective
Williams was known for its solid assets, strong demand for its products and a reputation for excellent service.
Its market value for Equity as compared to its competitors was as follows:
The Williams Companies
Dynegy
Dominion Resources
Murphy Oil
13,152
6,105
15,792
3,808
The increase in revenue was by $1.4 billion despite the economic downturn due to higher gas and electric power trading margins, higher natural gas revenues and higher natural gas sales prices
The company showed long term potentials due to its strong assets
The
1) Evaluate the terms of the proposed $900 million financing from the perspective of both parties. How would you calculate the return to investors in this transaction? If you need more information, what information do you need? 2
Q2) What is the purpose of each of the terms of the proposed financing 3
Q3) Conduct an analysis of Williams’ sources and uses of funds during the first half of 2002. How do you expect these numbers to evolve over the second half of 2002? What is the problem facing Williams? How did it get into this situation? How has it tried to address the problem it is facing? 3
Q4)Some might describe Williams as “financially distressed.” What evidence is there that Williams’ business may be compromised as a result of its previous financial decisions? 5
Q5) “Tough times demand tough decisions.” As the CEO of Williams, would you recommend accepting the proposed $900 million financing offer? If not, what alternatives would you pursue? 6
PERCENTAGE CONTRIBUTION
Roll Number
Name(PGP/17/)
Percentage Contribution
Ankit Kumar
195
20%
R Gayathri
228
20%
Shraddha Shrikhande
240
20%
Surbhi Kothari
248
20%
Sandeep Bhat
290
20%
1) Evaluate the terms of the proposed $900 million financing from the perspective of both parties. How would you calculate the return to investors in this transaction? If you need more information, what information do you need?
Evaluation from Berkshire Hathaway and Lehmann Brother’s Perspective
Williams was known for its solid assets, strong demand for its products and a reputation for excellent service.
Its market value for Equity as compared to its competitors was as follows:
The Williams Companies
Dynegy
Dominion Resources
Murphy Oil
13,152
6,105
15,792
3,808
The increase in revenue was by $1.4 billion despite the economic downturn due to higher gas and electric power trading margins, higher natural gas revenues and higher natural gas sales prices
The company showed long term potentials due to its strong assets
The