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Case HBS Case Collection November 1990 (Revised June 1993) FMC Corp.: A Recapitalization |
A proposed recapitalization will use new debt to pay a large dividend to some shareholders in return for a reduction of their voting power. The result will be a highly leveraged financial structure and negative owners' equity. Students can trace the effects of proposed borrowing and payouts. Provides a forum for discussing leverage and its uses and the meaning of negative owners' equity.
Keywords: Financial Statements; Financial Strategy; Asset Management; Financial Management; Business Conglomerates; Borrowing and Debt; Business and Shareholder Relations; Capital Structure; Equity; Private Equity; Chemical Industry;
Bruns, William J., Jr., and Julie H. Hertenstein. "FMC Corp.: A Recapitalization." Harvard Business School Case 191-084, November 1990. (Revised June 1993.)
