Case | HBS Case Collection | November 1988 (Revised September 1991)

Simmons Japan Ltd.

by W. Carl Kester and Richard P. Melnick

Abstract

Concerns the first leveraged buyout to occur in Japan. Analytic tasks include a valuation of the company and an assessment of its debt capacity. Also provides opportunities to discuss agency costs associated with alternative capital and equity ownership structures, differences between U.S. and Japanese corporate finance practices, and the potential role of leveraged buyouts in the restructuring of Japanese manufacturing.

Keywords: Leveraged Buyouts; Restructuring; Borrowing and Debt; Capital Structure; Cost; Equity; Production; Valuation; Japan; United States;

Citation:

Kester, W. Carl, and Richard P. Melnick. "Simmons Japan Ltd." Harvard Business School Case 289-001, November 1988. (Revised September 1991.)