By Nathaniel Durant, Harold Grousbeck
2000 | Case No. E58
This case describes the opportunity to conduct a strategic acquisition. The case starts out giving background on the entrepreneur and the presort mail industry. Then, it chronicles the entrepreneur’s original acquisition of his first presort company and the success that ensued from that acquisition. Next, the case discusses the opportunity for the entrepreneur to acquire a rival presort company in a different part of the company and gives background on that company. The entrepreneur successfully negotiates a term sheet with the sellers and begins to gather the financial resources to complete the transaction. He is successful in finding an outside investor and the original investors ask for a 50% step up on their original investment. With this new investor and new acquisition, the entrepreneur needs to rethink the composition of the Board of Directors. Finally, the entrepreneur needs to think through the operational difficulties in operating the combined entity. Teaching Note available.
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