Abstract This case runs in a participative and interactive manner, in order to develop students' financial, analytical and negotiating skills. A management buy-out from a U.K. conglomerate has survived as an independent entity for five years, but it now faces a bid from a major U.S. conglomerate. The case focuses on the key issues surrounding the bid, namely: the problems of using accounting information to judge the viability and value of a business; the critical need to ensure that a company's debt/equity structure reflects the degree of risk associated with its activities; and the difficulties of negotiating an acceptable sale price for a company, faced with the differing perspectives of the parties involved.
Boocock et al. (Sun,) studied this question.