Essay on Case Study

Words: 1458
Pages: 6

I. Case Introduction Before Chrysler merged to become DaimlerChrysler AG, they were presented with a takeover bid of $55 per share by MGM billionaire Kirk Kerkorian and former Chrysler chairman Lee Iacocca. Kirk Kerkorian was a stockholder in Chrysler and an experienced takeover financier who apparently found Chrysler to be a good buy. Chrysler rejected the offer, however, stating that the firm was not for sale. Further, many Wall Street experts felt that Kerkorian could not come up with the $20 billion necessary to complete the deal.

After Chrysler rejected Kirk Kerkorian’s bid of $55 per share, Kerkorian decided to have his people repeat the analysis of the firm’s financial performance over the two most
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|$5,056.00 |$4,892.00 |
|Current Ratio | current assets/current liabilities |1.48 |1.44 |1.78 |1.69 |
|Quick Ratio (Acid Test) | (CA-INV-PT-FR)/current liabilities |0.52 |0.53 |1.55 |1.51 |
| | | | | | |
|Activity | | | | | |
|Inventory Turnover | cost of good sold/inventory |9.29 |11.33 |7.41 |7.58 |
|Average Age of Inventory | 365/inventory turnover |39.31 |32.21 |0.021 |0.021 |
|Average Collection Period | 365/(sales/accounts receivable) |13.74 |11.84 |22.8 |23.4 |
|Fixed Asset Turnover | sales/fixed assets |4.22 |4.72 |1.54 |1.62 |
|Total Asset Turnover | sales/total assets |0.99 |1.05 |0.89 |0.91 |
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