Gardner Denver
Asset Management, Employee/HR, Investor/Finance, Leadership & Teamwork
James Quinn, Adam Blumenthal, and Jaan Elias
As KKR, a private equity firm, prepared to take Gardner-Denver, one of its portfolio companies, public in mid-2017, a discussion arose on the Gardner-Denver board about the implications of granting approximately $110 million in equity to its global employee base as part of its innovative “broad-based employee ownership program.” Was the generous equity package that Pete Stavros proposed be allotted to 6,100 employees the wisest move and the right timing for Gardner Denver and its new shareholders?
Acknowledgement: This case was made possible by the generosity of Adam M. Blumenthal ’89 MPPM and Steven M. Silver ’90 B.A.
Hirtle Callaghan & Co
Asset Management, Investor/Finance, Leadership & Teamwork
James Quinn, Jaan Elias, and Adam Blumenthal
In August 2019, Stephen Vaccaro, Yale MBA ‘03, became the director of private equity at Hirtle, Callaghan & Co., LLC (HC), a leading investment management firm associated with pioneering the outsourced chief investment office (OCIO) model for college endowments, foundations, and wealthy families. Vaccaro was tasked with spearheading efforts to grow HC’s private equity (PE) market value from $1 billion to a new target of roughly $3 billion in order to contribute to the effort of generating higher long-term returns for clients. Would investment committees overseeing endowments typically in the 10s or 100s of millions embrace this shift, and, more pointedly, was this the best move for client portfolios?
Acknowledgement: This case has been made possible by the generous support of the Jane Mendillo YC ’80, ’84 MBA and Ralph Earle ’84 MBA Fund and The International Center for Finance at the Yale School of Management.
Suwanee Lumber Company
Asset Management, Investor/Finance, Sustainability
Jaan Elias, Adam Blumenthal, James Shovlin, and Heather E. Tookes
Acknowledgement: This case was made possible by the generosity of Adam M. Blumenthal ’89 MPPM and Steven M. Silver ’90 B.A.
Suwanee Lumber Company (B)
Asset Management, Investor/Finance, Sustainability
Jaan Elias, Adam Blumenthal, James Shovlin, and Heather E. Tookes
In early 2018, Blue Wolf Capital Management received an offer to sell both its mill in Arkansas (Caddo) and its mill in Florida (Suwanee) to Conifex, an upstart Canadian lumber company. Blue Wolf hadn’t planned to put both mills up for sale yet, but was the deal too good to pass up? Blue Wolf had invested nearly $36.5 million into rehabilitating the Suwanee and Caddo mills. However, neither was fully operational yet. Did the offer price fairly value the prospects of the mills? How should Blue Wolf consider the Conifex stock? Should Blue Wolf conduct a more extensive sales process rather than settle for this somewhat unexpected offer?
Acknowledgement: This case was made possible by the generosity of Adam M. Blumenthal ’89 MPPM and Steven M. Silver ’90 B.A.
Home Health Care
Asset Management, Competitor/Strategy, Healthcare, Investor/Finance
Jean Rosenthal, Jaan Elias, Adam Blumenthal, and Jeremy Kogler
Acknowledgement: This case was made possible by the generosity of Adam M. Blumenthal ’89 MPPM and Steven M. Silver ’90 B.A.
The Federal Reserve Response to 9-11
Financial Regulation, Investor/Finance, Leadership & Teamwork, State & Society
Jean Rosenthal, William B. English, Jaan Elias
The attacks on New York City and the Pentagon in Washington, DC, on September 11, 2001, shocked the nation and the world. The attacks crippled the nerve center of the U.S. financial system. Information flow among banks, traders in multiple markets, and regulators was interrupted. Under Roger Ferguson’s leadership, the Federal Reserve made a series of decisions designed to provide confidence and increase liquidity in a severely damaged financial system. In hindsight, were these the best approaches? Were there other options that could have taken place?
Alternative Meat Industry: How Should Beyond Meat be Valued?
Competitor/Strategy, Customer/Marketing, Investor/Finance, Sourcing/Managing Funds, Sustainability
Nikki Springer, Leon Van Wyk, Jacob Thomas, K. Geert Rouwenhorst and Jaan Elias
In 2009, when experienced entrepreneur Ethan Brown decided to build a better veggie burger, he set his sights on an exceptional goal – create a plant-based McDonald’s equally beloved by the American appetite. To do this, he knew he needed to transform the idea of plant-based meat alternatives from the sleepy few veggie burger options in the grocer’s freezer case into a fundamentally different product. Would further investments in research and development help give Beyond Meat an edge? Would Americans continue to embrace meat alternatives, or would the initial fanfare subside below investor expectations?
Occidental Petroleum’s Acquisition of Anadarko
Asset Management, Competitor/Strategy, Investor/Finance, Sourcing/Managing Funds
Jaan Elias, Piyush Kabra, Jacob Thomas, K. Geert Rouwenhorst
In May of 2019, Vicki Hollub, the CEO of Occidental Petroleum (Oxy), pulled off a blockbuster. Bidding against Chevron, one of the world’s largest oil firms, she had managed to buy Anadarko, another oil company that was roughly the size of Oxy. Hollub believed that the combination of the two firms brought the possibility for billions of dollars in synergies, more than offsetting the cost of the acquisition. Had Hollub hurt shareholder value with Oxy’s ambitious deal, or had she bolstered a mid-size oil firm and made it a major player in the petroleum industry? Why didn’t investors see the tremendous synergies in which Hollub fervently believed?
Hertz Global Holdings (A): Uses of Debt and Equity
Asset Management, Financial Regulation, Sourcing/Managing Funds
Jean Rosenthal, Geert Rouwenhorst, Jacob Thomas, Allen Xu
By 2019, Hertz CEO Kathyrn Marinello and CFO Jamere Jackson had managed to streamline the venerable car rental firm’s operations. Their next steps were to consider ways to fine-tune Hertz’s capital structure. Would it make sense for Marinello and Jackson to lead Hertz to issue more equity to re-balance the structure? One possibility was a stock rights offering, but an established company issuing equity was not generally well-received by investors. How well would the market respond to an attempt by Hertz management to increase shareholder equity?
Hertz Global Holdings (B): Uses of Debt and Equity 2020
Asset Management, Investor/Finance, Sourcing/Managing Funds
Jean Rosenthal, Geert Rouwenhorst, Jacob Thomas, Allen Xu
In 2019, Hertz held a successful rights offering and restructured some of its debt. CEO Kathyrn Marinello and CFO Jamere Jackson were moving the company toward what seemed to be sustainable profitability, having implemented major structural and financial reforms. Analysts predicted a rosy future. Travel, particularly corporate travel, was increasing as the economy grew. With all the creativity that the company had shown in its financial arrangements, did it have any options remaining, even while under the court-led reorganization?
