Case | HBS Case Collection | June 2007 (Revised August 2007)

Dressen (Abridged) (A)

by Thomas R. Piper

Abstract

John Lynch, CEO of the Dressen Division of Westinghouse, was elated by the proposed leveraged buyout by the private equity firm, Warburg Pincus Ventures. The buyout would rid the division of a 'bad' parent and place the division's destiny in its own hands. A recently instituted restructuring plan seemed likely to improve profitability, but the turnaround was in its infancy. Would sources of finance support a financing plan that relied heavily on debt? Would Warburg Pincus Ventures be prepared to pay a price sufficient to win the bidding contest?

Keywords: Leveraged Buyouts; Restructuring; Forecasting and Prediction; Private Equity; Bids and Bidding; Valuation;

Citation:

Piper, Thomas R. "Dressen (Abridged) (A)." Harvard Business School Case 207-125, June 2007. (Revised August 2007.)