Business Case Studies & Business Publications

Arcadian Microarray Technologies, Inc.

Bruner, Robert F.,...

Case

Arcadian Microarray Technologies, Inc.

Bruner, Robert F.; Carr, Sean

F-1496 | Published September 12, 2005 | 18 pages Case

Collection: Darden School of Business

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Product Details

In August 2005, an investment manager of a hedge fund is considering purchasing an equity interest in a start-up biotechnology firm, Arcadian Microarray Technologies, Inc. The asking price is $40 million for a 60 percent equity interest. Managers of the firm are optimistic about the firm's future performance; the investment manager is more conservative in his expectations. He calls on the help of an analyst with her firm to fashion a counterproposal to Arcadian's management. The tasks for the student are to apply the concept of terminal value, interpret completed analyses and data, and derive implications of different terminal-value assumptions in an effort to recommend a counterproposal. Very little numerical figure-work is required of the student.