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Acquisition Issues Benchmarking
Miltonieka Gray Bell, Carolyn Edwards, Kenya Irving,
Natalie Tucker, Kimberly White
University of Phoenix
Team C
September 4, 2008








Lester Electronics, Inc.
Lester Electronics, Inc. is a corporation that distributes electronic components to original electronic manufactures, repair facilities, and small local distributors in America and Asia. Currently, Lester Electronics has an elite supply arrangement with Shang-wa Electronics, which preserves the rights to sell Shang-wa capacitors. Jon Lin, Shang-wa Chief Executive Officer wants to take pleasure in enjoying life away form the office, but has to make stipulations for someone to administrate the business. At present, Shang-wa is threatened by an aggressive takeover by Transnational Electronics Corporation; and Avral Electronics, S.A. is scrutinizing Lester Electronics. If the elite supply arrangement between Lester Electronics and Shang-wa is loss, Lester Electronics faces a 45% loss in their projected profits over the next five years. Lester Electronics and Shang-wa are considering a partnership, which could postpone the interest of Avral Electronics, S.A. and ensure financial stability for both companies.
Citibank
Lester Electronics, Inc. (LEI), a consumer and industrial electronics parts distributor, is facing the decision to acquire Shang-wa Electronics, a Korean capacitor manufacturer. LEI and Shang-wa entered into an exclusive contract reserving sole distribution rights of their product. LEI made the decision to collaborate with Shang-wa to remain more competitive within their industry and continue to meet needs globally. Currently, LEI’s annual revenue is approximately $500 million and is now traded on the NASDAQ market. In the event that Shang-wa is not acquired, LEI stands to lose 43% of revenue over the next five years. In addition, Shag-wa...