Case_In_Point_7th_Edition_Page001_183_2

CS2 Hong Kong Video Games Notes
Summarize the case and verif y the o bective.This j is a pretty short case, so instead of repeating the
question, just state, “Besides determining the key factors to this acquisition, are there any other
objectives I should be concerned with?” Assume no other objectives.
Aay out y our structure.This is a merger and acquisitions case. Break it down into four main buckets:
company objective, acquisition costs, due diligence and risks and exit strategies.
l ompany o ective.First b j ask about the Hong Kong company. Who are they and what do they do? Are
they private equity or a competitor in this market? Why do they want to buy this company? Access to the
US market? Patented technology? Increased market share? Cost saving synergies?
q ue dili’ence and ris?s.Things you should have considered are the shape of the economy and the
industry. Is the acquisition target a market leader, and how secure are their customers, access to raw
materials and distribution channels? You should have touched on the meshing of the two company
cultures, margins, company and industry growth trends and competitive response.
L cEuisition costs.Asking price; is it fair and can we afford it under various economic scenarios?
x xit strate’ y Hold . it, break it up and sell it off?