Jaguar Capital S.A.S., Take the Money and Run?

In January 2014, Tomas Uribe and Rodrigo Sanchez-Rios of Jaguar Capital S.A.S. (Jaguar or Jaguar Capital), were considering an offer from White Stone, the world’s largest private equity real estate investor. Jaguar Capital needed capital to fund its investment thesis, which was derived from Tomas and Rodrigo’s belief that the rise of Colombia’s middle class signaled an enormous untapped investment opportunity. Jaguar hoped to capitalize on Colombia’s middle class need of safe comfortable places to spend family time by providing retail, housing and entertainment facilities that catered to Colombia’s middle class. While White Stone’s proposal would solve many of Jaguar’s challenges as a start-up real estate development company, the offer would also create a new series of long-term issues for Jaguar.
In this case, students examine the favorable and unfavorable attributes of the White Stone offer, especially as it relates to the unique situation of the protagonists. Additionally, the financial terms of the offer are compared to the terms of similar deals. Key questions explored through the case include the following: Would the White Stone proposal truly compensate Tomas and Rodrigo for all their hard work to date? Would they be fairly compensated in the future given the risks that they would bear and the work they have would do? Most importantly, should they take the deal?