general mills

Topics: General Mills, Stock, Diageo Pages: 19 (527 words) Published: December 25, 2013
GENERAL MILLS’ ACQUISITION
OF PILLSBURY FROM DIAGEO
PLC

101357030 連振廷101357036 林仕翰
101380016 徐煥哲102357014 顏子皓
102357016 李光耀

AGENDA


Issue



併購分析








(1)公司介紹
(2)併購動機
(3)併購條件
(4)價格爭議
(5)CVR的使用
併購方法評價

• (1) Acquisition Advantage
• (2) Acquisition Cost
• (3) Acquisition Profit

4.結論

ISSUE
General Mill 想從 Diageo Plc. 手中併購
Pillsbury,兩方對併購價有不同的認知,要如
何解決這次的價格爭議?
General Mill的股東是否應該贊同這項併購案?

併購分析
102357016 李光耀

公司介紹
General Mills

Diageo Plc.

Pillsbury

設立年

1856

1997

1872

總部

Minnesota

UK

Minnesota

產業

食品製造業

酒精類飲料

食品製造業

知名品牌

Betty Crocker
Big G cereal
Yoplait

Johnnie Walker

Doughboy
Green Giant
Haagen-Dazs

2000年營收

$7.5 billion
麥片佔營收60%

$6.1billion

全美最大優格製
造商&第二大穀
物早餐製造商

提供冷凍的麵團
製品(餅乾 小麵包)

併購動機
General Mills的角度:
擴張海外市場

擴展通路

好處

節省成本

Diageo Plc. 的角度:
賣出Pillsbury 專注本業發展

產品多角化

併購動機

併購條件
General Mills

Diageo

Pillsbury

Equity

Debt

價格爭議
General Mill的觀點:
只想用$10Billion 價值收購
認為自己股價被低估,不想以股換股但卻被迫以股換股

現金不足

原因

GM手上現金只有
$25.6M

不想額外舉債

恐被調降債信評等

綜效不確定

價格爭議
Diageo Plc的觀點:
想賣至少$10.5Billion
對合併後股價有信心,認為會漲到$38以上,就能獲得10.5 Billion 的價值

CVR的使用
Contingent
payment (CVR)

避免買貴

Good Signal!!

ACQUISITION
VALUATION

102357014 顏子皓

VALUATION PART
Acquisition Advantage
(Pillsbury stand alone)+ Synergies

Acquisition Cost
Stock paid value + Debt assumed -CVR Value

ACQUISITION ADVANTAGE

SYNERGIES COME
FROM

1.Efficiencies in selling and
marketing
2.Streaming of administrative
activities

1.Product innovation
2.Channel expansion
3.International expansion
4.Productivity gain

DISCOUNT RATE
ESTIMATION
1.Discount rate used in evaluating investment
project should be determined by project’s risk not
the source of financing.

2.In the aspect of GM’s shareholders
We use Ke as our discount rate!!

COST OF EQUITY
ESTIMATION
Rf=5.7%
Beta=0.65
Market risk premium(general knowledge in
2000)=5.5%
Cost of Equity=9.3%

DCF-SYNERGY VALUATIONOPTIMISTIC
GM synergy
valuation
year

(million)
2000

2001
1

2002
2
781%

2003
3
85%

2004
4
2%

2005
5
2%

26

229

424

433

442

10.4
15.6

91.6
137.4

169.6
254.4

173.2
259.8

15.6

137.4

254.4

259.8

176.8
265.2
3695
3960.2

Growth rate
pre tax cost saving
tax expanse@0.4
after tax cost saving
terminal value

NPV
Billion
Terminal g

$3,044.88
3.045
2%

DCF-SYNERGY VALUATIONCONSERVATIVE
GM synergy
valuation
year

(million)
2000

2001
1

Growth rate
pre tax cost saving
tax expanse@0.4
after tax cost saving

26
10.4
15.6

2002
2
781%
229
91.6
137.4

2003
3
85%
424
169.6
254.4

2004
4
2%
433
173.2
259.8

terminal value

2005
5
2%
442
176.8
265.2
3259.084

15.6
NPV

$2,765.43

Billion
Terminal g

$2.77

1%

137.4

254.4

259.8
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