Olam International, a publicly listed company, was a leading agri business with an integrated supply chain. To sustain growth, the business took on large amounts of debt to fund acquisitions and other capital expenditures. A hedge fund issued a Sell recommendation, emphasizing the issues confronting the firm, including several years of negative free cash flows.
The heated exchange between the hedge fund and Olam caused Temasek, government investment fund to first support Olam and later offer to buy out the minority investors. This scenario presents an excellent opportunity to use relative valuation techniques and the discounted cash flow evaluation to assess the offer of Temasek. Ruth S. K. Tan is affiliated with NUS Business School. Zsuzsa R. Huszar is affiliated with NUS Business School. Weina Zhang is affiliated with NUS Business School.
Temasek's Offer to Buy Olam International case study solution
PUBLICATION DATE: April 10, 2015 PRODUCT #: W14757-PDF-ENG
This is just an excerpt. This case is about FINANCE & ACCOUNTING
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