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Saul Steinberg Case Study Of Disney Production Case

711 Words3 Pages

Saul Steinberg, a famous raider who is extremely interested in Disney Productions and has the intention to takeover the company before Disney Production get listed. Saul Steinberg purchase quietly the shares issued by Disney Productions and he increased the percentage of share hold in hand from 6.3% to 12.1%. However, the president and CEO of Disney production who is Ron Miller realised this problem only when Saul Steinberg announced to hold 25% of total shares of Disney Production that present in the stock market. Therefore, Ron Miller decide to defense hence take some action such as purchase Arvida Corporation and Gibson Greetings Inc to prevent Saul Steinberg successfully take over his company. However, Saul Steinberg doesn’t give up to …show more content…

This is not the first time Saul Steinberg to do so as he just received $47 million from Quaker State Oil Company in April 1984. Saul Steinberg feels Disney Production has the value that attracted him decided to take over the company during 1984. As the Walt Disney has the strong business strategy and diversified portfolio which consists of four segments of businesses and each of diversified business segments are supporting the activities of one another. Besides, each of the strong management teams which are well-organized to ensure that the business is run smoothly, hence this is the reason why Disney Production able to diversified their business into various …show more content…

One of the evasive action of Ron Miller is to defense with the purchase of Arvida Corporation, a florida based land-development firm that worth $200 million which around 3.33 million shares of Disney Production. The reason why Ron Miller to has this decision is to increase the total amount of company debt as originally Disney Production do not have any long term debt. However, Saul Steinberg fight in the court try to stop this deal but end up he lose in court. Hence, Ron Miller continues his plan with purchase another company named Gibsons Greetings Inc for another $310 million. The reason why Ron Miller to do so is to reduce the amount of share hold by Saul Steinberg indirectly to 10% and below which might eliminate his right to takeover his company.

As the result, Ron Miller has successfully increase the total debt of Disney Production to $866 million which around 67% of Disney Production’s total equity, compared with a much more conservative 25% prior to Saul Steinberg 's assault. Besides, Ron Miller aims to make Disney Production become much less attractive to other potential raiders which to reduce the possibility of raiders attempt to takeover his

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