Walt Disney Productions Case

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Case overview: Walt Disney Productions Inc., or “the Company,” is a “diversified international company engaged in family entertainment and community development,” serving customers through a variety of mediums. The Company utilizes four business segments to reach its customers and generate revenue. Walt Disney Productions competes in the following four segments: theme parks, films, consumer products, and real estate development. The Company, led by president and chief executive officer, Ron Miller, is facing a takeover attempt by Saul Steinberg, a notorious greenmailer. It appears as if Mr. Miller has a limited number of options available. He can either fight the takeover attempt to eradicate Mr. Steinberg’s efforts, or he can repurchase the shares that Mr. Steinberg currently owns. Walt Disney Productions and Mr. Miller must find the most optimal solution to the aforementioned issue, as well as an effective way to resolve the myriad of secondary issues that the Company is facing. At a high level, Disney’s performance is troubling. Using Exhibit 5 as a starting point for our analysis, we completed a DuPont analysis. In this, we found several major trends: net income is decreasing while sales, assets, and equity all increased year over year. We found these results to be a troubling because of a decline in ROA and ROE with increased asset and equity bases. Further analysis is required to discern decreased performance from these metrics, however one thing has become clear; Disney, because of various factors, is not financially healthy, thereby prompting this potential hostile takeover. The Company faces numerous issues. The primary issue that Walt Disney Productions faces is Mr. Steinberg’s offer. Mr. Steinberg is offering a public offer for 49 percent of company. If the Company decides to complete its acquisition of Gibson Greetings, Mr. Steinberg will pay

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