Strategic Thought Transformation - The IIPM Think Tank

it summons the title of the largest leveraged buyout. Kohlberg Kravis Roberts (KKR) and Bain Capital along with Merrill Lynch have offered
a mammoth sum of $21 billion for HCA, America’s largest hospital chain. The deal also comes with an assurance that the acquirers take
up the firm’s debt burden of $11.7 billion. HCA runs 182 hospitals and its annual revenues amount to around $24 billion.
Certification lag spurs the spin off
After reporting 54% rise in second quarter profits, Raytheon, the world’s largest missile manufacturer has plans to sell off its aircraft unit.
Credit Suisse has been appointed to hunt for suitable strategic options for the deal, which is to include a stock offering. This spin off of the
general aviation and business aircraft manufacturing division has stemmed from certification lags of the Hawker 4000 Jet. The Flight Options
business and Raytheon Airline Aviation Services, its regional aircraft asset management operation will not form part of the deal.
Winning needs nerves of steel
Another leg in the Arcelor deal has come forward. Mittal Steel Co. is required to put forth an offer to buy out the shareholders of Arcelor’s
Brazilian division in order to see the mega merger through. This could raise the cost of the $31.9 billion deal by an added $5 billion; the
combined company will comprise 10% of the global steel production. The shareholders of Arcelor Brasil SA, listed on the Sao Paulo Stock
Exchange urged the Brazilian Security & Exchange Commission to look into the issue after Mittal refused to offer a buyout. Mittal will
contest the decision in the court.
HBOS employees get it all and more
The good times are not yet over for over 17,000 employees of the Halifax Bank of Scotland (HBOS), which is the fourth largest
bank in UK. Five months ago, the employees had all earned an enviable bonus of about £4400 each and now there’s a fresh
piece of good news for them. They are expected to now get around £19.6 million in free shares. The said sum is about 5% of
annual salaries of the employees. The announcement was made as the bank reported a healthy 17% rise in half-year pre-tax
profits to £4.98 billion.
Encash your loss before it turns into ash
Not all’s well at Dell. The world’s largest computer firm has been set ablaze. In collaboration with the US Consumer Product Safety Commission
and other associated regulatory authorities across the globe, Dell has voluntarily declared the recall of 4.1 million lithium-ion
batteries (manufactured by Sony) used in its laptops. Six reported cases of smoldering computers in the US triggered off a month long
investigation led by both the companies. Three-fourth of the faulty pieces have been sold in the US alone, while a million have touched
the overseas clients. The marred batteries in question were dispatched by Dell during the period April 2004 to July 2006. The problem
that has been detected with these batteries hints at a certain metal contamination within the battery packs. Excessive pressure exerted
causes the metal to perforate the insulation, giving way to a short thereby overheating the battery. In exceptional cases, shorts can result
in fires. The recall involving batteries fabricated by Sony Corp. could cost the company about $400 million.
Connecting the musical way
Nokia, the Finnish handset seller, has come up with another way of connecting people. Nokia has bought Seattle-based Loudeye for $60 million.
Loudeye possesses a vast digital music catalogue. In 2004, it had bought the British music download service OD2 that now manages a licensed
catalogue with nearly 1.5 million tracks. The deal will enable Nokia to gift its customers holding music enabled phones access to the wonderful collection.
Last year, Nokia sold over 45 million music-enabled hand sets, and plans to sell about 80 million in 2006. Australia’s second biggest newspaper
publisher, John Fairfax Holdings, that mainly operates in New Zealand & Australia is making a comeback to the Asian market. The newspaper group
has signed on the dotted line to purchase a string of seven magazines in Singapore, Malaysia & New Zealand from the International Data Group
for an undisclosed amount. The deal will bestow Fairfax with licensing rights to the magazines’ content for the Asian zone. Fairfax also publishes
Managing Information Systems (MIS) Asia & MIS New Zealand. In addition to the above, Fairfax will trade its MIS UK & rental list business Market
Base to IDG.
An IIPM Intelligence Unit Publication STRATEGIC INNOVATORS 101