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In Reply to: Harman International to be Sold to KKR/Goldman Sachs posted by bondmanp on April 26, 2007 at 06:15:41:
Existing shareholders have a choice between tendering theire shares for cash or for shares in a new company, which will be controlled by KKR and the shares of which will not be listed on any public exchange. However, there is a cap to the percentage of shares of the new company that will be exchanged to the current shareholders.This seems to be giving KKR control of the company to do with it what they will to "dress it up" for a sale to someone else. My guess is that dressing it up will include the sale or spinoff of some divisions that are relative underperformers.
And my further guess is that the divisions doing high-end home audio would be at the top of that list. They may be performing o.k. from a financial standpoint, but the growth opportunities for them would appear to be close to zero. The only issue is whether the "halo effect" from them helps drive the sale of big-ticket stuff like Harmon-Kardon car stereos, which is where the company does a lot of business.
Follow Ups:
for the cash and get rich while the wolves gut the company. I feel sorry for the workers who were not consulted.
"I feel sorry for the workers who were not consulted."Surely it is shareholders that own the firm, it is only their approval that is required to sell it. The stark reality is very simple, the primary duty of any commercial enterprise is to make profit for its owners, everything else is secondary to this or undertaken to fulfil this duty.
Music making the painting, recording it the photograph
... is that investment is everything and that employees -- or to use the old, original term, "servants of the company" -- are of no account.Yes, it was Marx who said that the investor pays an worker the minimum he or she is willing to work for, and expropriates the "surplus value" of the workers effort. For my part I believe that the true entrepreneur, the risk taker, has an extremely valuable role to play, but the powerful financial interests that control the economy today are a long way from true risk-taking entrepreneurs. Rather they do everthing they can to minimize risk to themselves, and through their exercise of power, they do it by screwing over workers and communities.
Bill Bailey
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See my stereo config
Private property is sacred to Mammon.
< < the primary duty of any commercial enterprise is to make profit for its owners > >I would instead argue that the primary duty of any commercial enterprise is to make a profit. Otherwise it will go out of business and there is no point to the enterprise. But as long as it makes a profit, then it can do whatever it wants to do.
Here's an example. We spend about $12,000 a month to pay 100% health and dental insurance for our 16 employees *and* their families. We don't have to do this. We could instead give this money to the company owners.
But in my opinion (as one of the owners), that would suck. YMMV.
of change IMO. Where is it written that the only goal of commercial enterprise is profit for the owners. At some point the need of the workers and the communities they reside in must enter the equations.
"At some point the need of the workers and the communities they reside in must enter the equations. "Looked in the long term, a healthy wrker population and surrounding community is intrinsic to a healthy and profitable company. It's funny how most American businesses don't look beyond the next quarter or two.
Did you know that Panasonic has a 500 Year Plan for their company?
of press releases, which is basically to say nothing while meeting the bare minimum required for disclosure. At this point, I'd say it is speculative to even speculate (smiley face) what might be in store. I think you'd have to have a very good understanding of the inner workings of their financials.Deals like this are always fraught with new opportunities for those entrepeneurial spirits.
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