Delaware Equipment Ltd Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Delaware Equipment Ltd Case Solution

Introduction

Acquisition is one of the major decisions for many companies. This decision is taken usually when they suffer a major loss or want to increase their operations and sales cycle. Acquisition takes palce when an entity acquires another entity. Acquisition is not always successful as it can lead to severe damage of the industry because of poor industry takeover. The main problem of acquisition is that it does not focus on the future market trends, which will occur in the future.

The results from that case will help the readers and also the decision makers to involve in serious analysis to look after for their future benefits. Acquisitions can also be beneficial for the companies to increase their market value in terms of operational size and product expansion.

The case is entirely focused on the acquisition of a particular entity by Delaware Equipment Ltd,which started its business in 1950 as a manufacturer of the Agricultural industry. During 1980s, the sales growth was enormous as compared to the expectations and in the late 1990s, Delaware’s sales decline due to poor management control. In 1999, the company started thinking for acquisition with other entities in order to increase its market value, which was declined in 1997. After considering some serious analysis, it was decided that Delaware wanted to acquire four different companies for its future success. However, only Kaufman rejected to join Delaware as it was already struggling for its better future. The case clearly highlights the importance of acquisition and its future benefits as well as loss.

Situational Analysis

Delaware is considered as one of the top companies in agricultural industry. It has a successful story over its acquisition with different companies and has a lot of experiences in merger and acquisitions. As it planned to acquire different companies in 1999 and made some conditions that are restricted for the new comers,these conditions showed that Delaware only acquired leading companies in order to take advantage from them. In 2000, Delaware began to start acquisitions with different companies of the same industry in nature.

These all acquisitions were successful however, Delaware was unable to acquired Kaufman. Now there are some reasons which I will discuss later in this part and to recommend some actions for changes and decisions therefore, the question is why United and amalgamated also wanted to acquire Kaufman. First, the story of United is very much controversial to Delaware, as the problem was that they wanted to acquire Kaufman as its operating division with only one-sixth of the combined sales. This offer was seriously a threat to Kaufman as it would lose control. Kaufman was controlled by its family, which they did not wanted to give out to others.

United industries already acquired 285,000 shares of Kaufman therefore, they wanted to acquire the whole company with some additional shares requirement. They also made a public offer to Kaufman immediately for their response. This offer was read out by many companies and some of them were against this offer such as Delaware. The main reason behind such controversial issue was Kaufman’s strong internal operations in North America. Every industry knew that North America had the cheapest rates of imports. Delaware also considered that if it acquired this company, then it would be its advantage to expand its operations and to sell its products in less price.................

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