Which Takeovers are Profitable: Strategic or Financial?

Paul M. Healy; Krishna G. Palepu; Richard S. Ruback

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Article | MIT Sloan Management Review | summer 1997

Which Takeovers are Profitable: Strategic or Financial?

by Paul M. Healy, Krishna G. Palepu and Richard S. Ruback

Keywords: Integration; Profit; Strategy; Finance;

Format: Print

13 pages

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Citation:

Healy, Paul M., Krishna G. Palepu, and Richard S. Ruback. "Which Takeovers are Profitable: Strategic or Financial?" MIT Sloan Management Review 38, no. 4 (summer 1997): 45–57.

About the Authors

Paul M. Healy

James R. Williston Professor of Business Administration

Accounting and Management

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Krishna G. Palepu

Ross Graham Walker Professor of Business Administration

Accounting and Management

General Management

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Richard S. Ruback

Baker Foundation Professor, Willard Prescott Smith Professor of Corporate Finance, Emeritus

Finance

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Property Finder’s Strategy for Online Classifieds in the MENA Region

Krishna G. Palepu, Gamze Yucaoglu and Fares Khrais

The case opens in 2020 as Michael Lahyani, founder and CEO of Property Finder, Dubai’s leading online real estate classifieds portal, contemplates the company’s five-year growth strategy.
Since its founding in 2005 in the United Arab Emirates (UAE), Property Finder had secured multiple rounds of investments and expanded into countries in the Middle East and North Africa. The business grew following a proven business model revolving around monthly flat subscription fees paid by real estate brokers for packages of listings, while remaining free for end-customers to browse. By 2020, Property Finder had reached profitability in the UAE, Bahrain, and Qatar, which it considered its core markets, and had done significant brand building in newer markets of Saudi Arabia (KSA), Egypt, Morocco, Lebanon, and Turkey.
In 2020, Lahyani needed to decide on the company’s growth strategy to increase profitability. Property Finder could focus on its core markets and switch to segmented pricing, lure in more developers to post first hand property directly, and create new revenue channels. Alternatively or in parallel, the company could tailor its business model to suit the dynamics of each of its newer markets. All the while, Lahyani had just onboarded a new executive team that was busy adjusting the organizational structure and institutionalizing procedures and processes. As a result, company resources were spread thin and Lahyani found himself at a crossroads; should the company focus its efforts on bolstering its position in incumbent markets and thus forego growth abroad, or should it pursue new markets and risk tarnishing its reputation in its core markets in case of a failure?

Keywords: General Business; real estate; Entrepreneurship; Strategy; Emerging Markets; Growth Management; Real Estate Industry; Technology Industry; United Arab Emirates; Saudi Arabia; Egypt; Turkey;

Citation:
Palepu, Krishna G., Gamze Yucaoglu, and Fares Khrais. "Property Finder’s Strategy for Online Classifieds in the MENA Region." Harvard Business School Case 321-009, July 2020. (Revised September 2020.) View Details

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Which Takeovers are Profitable: Strategic or Financial?

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