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Zubinos

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by

dinesh rajendren

on 19 March 2014

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Transcript of Zubinos

Advisory on Zubinos
Strategic
and
Ethical
Issues

ZUBINOS Coffee Shops
MATTERS OF INTEREST
TAKEOVER PROPOSAL BY WCB
RECOMMENDATION
OVERSEAS EXPANSION
ETHICAL ISSUE
CONCLUSION
BY : BUSINESS LEADERS
RECOMMENDATION
Remuneration committee.
At least 3 Independent Non Executive Directors
Components


Balanced scorecard methodology.
Sun Tzu's Art of War
Current Dilemma.
What is "excessive"??
Corporate Governance.
"KNOW YOURSELF,ENEMY,SURROUNDINGS"
FIRST PRIORITY- PROPOSED TAKEOVER BY WCB

SECOND PRIORITY- OVERSEAS EXPANSION STRATEGY

THIRD PRIORITY - ETHICAL ISSUE ON EXCESSIVE REMUNERATION
Current situation
10 loss making shops
European Crisis
RECOMMENDATION
Research and Development
PESTEL
Franchising

Largest and fastest growing market.
Labor cost in India cheaper compared to other countries.
Number of people moving to growth location for manual labor.
Raw material are source locally.

Prospects of Indian Market
-cultural differences and market preferences using PESTEL measures.
ADVANTAGES
Corporate image,brand awareness and trademarks



Save time
Quick business expansion
Low Risk

Polycentric approach
Research and development
Offer Price of £20 per share by WCB


Minority Shareholders

Fairness of the offer price to Zubinos

Other Key Issues
No succession plan
Lack of integrated IT Infrastructure

Offer Price- £20 Per Share
Quantitative Factors
Qualitative factors
Future value £30 per share


Average P/E of similar listed businesses to Zubinos is 8
Expected value of shares would be £90 million (£11.25 million × 8).
Therefore, the value per share is £30 (£90 million / 3 million shares).

Synergy and competitive advantage
Saving of finance cost and gain from financial synergy
Sustainable and consistent capabilities

Duplicated activities could be eliminated and excess resources could be reduced
Capacity of IT network
Share of expertise such as franchise management skills

Minority Shareholders
Difference in Attitude
Risk Takers
Risk Avoiders
"We work together as a team to meet and excel the expectations of our stakeholders of becoming the
pioneer of coffee brand.
We have the
passion for excellence
for delivering the highest standards of experience which
create a differentiated value
of identifying who we are.
We continuously seek to
celebrate ideas and innovation
which
embraces change that leads to a better quality of life."

13 years business
Family-owned company

90 shops throughout the borders of UK and Europe

Listed on 1 February 2009 through Alternative Investment Market (AIM)
Exponential growth throughout 13 years
Facing a downturn based on current evaluation
Highly recommended to accept the friendly acquisition by WCB

Expansion plan should be an obstacle.
Ethical issue should not be overlooked
Full transcript