Holding Company

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Case Study Prompt

Client is a holding company or conglomerate. They are a longstanding client of ours. Their revenues are about 1.5B/year. They hold all sorts of companies, mostly around low tech manufacturing, including roughly in the Oil and Gas, Automotive, and Other categories. The holding company doesn’t really have a unified portfolio, but basically places bets on companies it acquires. They are not looking for synergies necessarily.

It is now looking at an auto parts manufacturer and trying to get an idea of whether it should acquire it. Financial health is excellent – sitting on a lot of cash. Their portfolio is well diversified. They offer after market products – winches for cars, trucks, ATV’s (revenues of 300M for this product line). They have 90% of the market in the US, and the market is expected to have flat growth. Their second division is drive train mechanism for switching car from 2W drive to 4W drive. It’s a small niche market, mostly luxury cars.

What kind of things would you want to investigate to find out whether it was a good idea to acquire the manufacturer?

Case Study Overview

In this case, the client is a large conglomerate. The company is looking at expanding its portfolio of companies to include an auto parts manufacturer. You have been hired to advise the client on the acquisition – go or no-go?

In an M&A case like this, it’s important to give a strong yes/no recommendation in your conclusion. In addition, pay attention to the type of buyer you’re serving – they have different goals.

Use the M&A Framework to build your structure for the case, but don’t box yourself in to that singular framework. Use your knowledge of the basic frameworks to create a custom structure tailored to the specifics of the case.

You could expect to see a case like this in a Booz Allen first round. The qualitative difficulty of the case is 2 (out of 4), and it has no math diagrams.

Interview Tips: Booz Allen Hamilton

Booz Allen Hamilton is most impressed with advanced presentation and interpersonal skills in its case interview candidates.

Place your focus on clearly communicating as you walk through the case (bonus points for style!).

In this case, find 1 key takeaway or area you can improve in the case.

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