Categories
FINANCE x SECURITIES Management x CASE & BP

“How much are you REALLY worth?” – said Shareholder X

The world’s largest mining company, BHP Billiton, placed a hostile bid of $130 per share on PotashCorp. As evident from the name, they are the largest potash producer in the world, based in Saskatchewan. However, the CEO of PotashCorp, Bill Doyle, strong believes the starting bid of $38.6 is extremely undervalued; considering the company reached an “all-time peak of $239.50 on the New York Stock Exchange on June 17, 2008”. But, he clearly didn’t specify it dropped to $49.60 six months later. Relating to what guest speaker Murray Carlson said, various firms have reported that the bid could be somewhat higher (perhaps at a suggested $145 per share). But as a corporation, they have to take into account all the shareholder’s desires. Thus, the decision of whether PotashCorp is sold is completely dependent on what the shareholders deem valuable (in the future).

Despite BHP Billiton’s reputation and decent bid, Bill Doyle is confident that they will “blow the doors off” its record-high $240 a share as long as it remains independent. This decision affects  various factors: not only is the financial aspect an issue, but due to natural resources, politics have made a stand too.

Word Count: 195
*reference: http://www.theglobeandmail.com/globe-investor/potash/potash-corp-ceo-pushes-for-offer-that-far-exceeds-170-per-share/article1747669/

Categories
MARKETING MIS (Management of Information Sys.)

Advertising Rebound; but even the TV?

Despite the intensely growing potential of the internet (and social media) in advertising, it is a surprise that television remains to be a strong presence – especially after the few years of recession. As noted in class, not only “IT-infused organizations” use MIS (Management of Information Systems). Many individuals have decided to opt from television to Web 2.0 alternatives; however – unlike television – they lack the ability to “monopolise attention” as one sits in front of the box. Similar to “search engines and online banners”, they are unable to capture the consumer’s attention effectively. Thus, this focal differentiating factor also helps it recover.

As consumers enter the market of electronic information distribution (newspapers, classified-ads, and magazines), the classic advertising market is shrinking. Many companies are turning towards social media: Facebook and Twitter; which is also more accessible to mobile users. Through personal experience, all of news and media are derived from the Web. Moreover, this is because it can be accessed on-the-go; but at the same time, I never bother to notice or read the advertisements. Whereas, when I am watching the television, I am – to an extent – forced to bear through the commercials.

http://www.economist.com/node/17149050
Word Count: 199

Categories
ETHICS x CSR (Corp. Social Responsibility) MARKETING

Kill yourself saving.

For many years, the business of fake drugs has existed; mainly in poorer countries. With a lack of enforcement and punishment, these counterfeits are beginning to play a role in richer areas like “Canada and Britain”.

When the consequence of an illegal action has a bearable dollar value on it, the situation then becomes a business opportunity, given one can afford it – financially and ethically.

The article notes various “drug giants” such as Pfizer (whom sells Viagra) are long-time victims of fake drugs. Numerous solutions were suggested; ranging from mobile-texting to “using radio-frequency identification chips” to accurately track each package. But at the end of the day, the price point of drugs at designated drugstores is set where many families are not willing to pay for. Depending on the condition, these are fairly inelastic products; as a result, consumers look for cheaper alternatives.

Like the TATA Nano, families in poorer countries must have their basic needs (like food) covered prior to other expenses. If hunger is not satisfied, nor will drugs be considered.

Given there is demand for drugs, there will always be willing suppliers: many of which will be fakes, regardless of new technological drug-verification implementations.

References (below); Word count : 200 including TITLE (above)

Source: TheEconomist @ http://economist.com/node/16943895

http://economist.com/node/16943895

Categories
General

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