MBA 540 - Wealth Maximization Concepts Worksheet

In this scenario four companies are shown going through a process to increase their corporate wealth. But the manner in which this is attempted is done in three different manners, with three separate objectives. Transnational Electronics and Avral Electronics are looking to grow their respective companies through the acquisition of existing successful organizations. These companies would rather invest the capital assets in acquiring an existing company versus spending those same funds to internally grow their businesses. Lester Electronics is attempting to avoid a hostile take-over of their company as well as take-over of contractual business partner, which would decrease revenue by 43% over 5 years if successful. Shang-wa Electronics, like their business partner Lester Electronics, is attempting to avoid a hostile take-over for a preferred joint venture with Lester. This would enable John Lin, Shang-wa founder and CEO, the opportunity to decrease his role in the company as retires, while leaving the company he built in the hands of a strong management, long time business partner and friend, Bernard Lester."Corporate

[New York Bank Note Co. notice] (LOC)

English: Revenue growth and profitability

English: Revenue growth and profitability (ROX)

wealth is that wealth over which management has effective control; it is closely associated with corporate growth and corporate size. Corporate wealth is not necessarily shareholder wealth. Corporate wealth tends to lead to increased growth by providing funds for growth and limiting the extent to which new equity is raised. Increased growth and size are not necessarily the same thing as increased shareholder wealth." (Ross, Westerfield, Jaffe, 2005, pg. 15) "Financial planning establishes guidelines for change in the firm. These guidelines should include (1) an identification of the firm's financial goals, (2) an analysis of the differences between these goals and the current financial status of the firm, and (3) a statement of the actions needed for the firm to achieve its financial goals." (Ross, Westerfield, Jaffe, 2005,