Frank Spence

Mergers & Acquisitions

Prof. DL Sunder

IIM Indore, Mumbai Campus,

PGP-2
Group 02
B.Siva Sankaran
Basamgari Mounica
Devi Prasad Khatua
Divya Rangray

Frank Spence
Analysis of the medical products distribution
business
The latest venture started by Frank Spence
Excellent personal contacts with hospitals,
doctors and HMOs
Focused on niche products
Limited geographic coverage
No exclusive contracts
Negligible fixed assets
Possessed transparent information systems

Successful Outcome Analysis

Income Statement Analysis

PtP
OI
OE
CoS
NS

1990

1991

1992

1993

1994

Valuation
60
49.18

50
44.24
40
34.48

DKW

30

FS
20

10

6.91

8.9

2.96
0

17.68

16.54

2.36

0.11
EV/sales

EV/EBITDA

EV/EBIT

MV/Net Income

MV/BV

The PV of all future cash flows is $30 million.

There has to be substantial investment in fixed assets.
Diligent steps should be carried out to keep the contact and
reputation that Frank Spence has built through his personal
contacts.

Thank you