Essay About Butler Capital Partners And Private Equity

Butler Capital Partners and Auto Distribution
Butler Capital Partners and Autodistribution: Putting Private Equity to Work in FranceSubmitted in partial fulfillment of the requirements in Entrepreneurial FinanceDate SubmittedSeptember 26, 2015Case Background Statement of the ProblemShould Butler Capital Partners accept the proposal to invest in Autodistribution given the following constraints such as inflexible price, little time to evaluate the investment and to secure financing and equity commitment requirement of 1.5 times the size of the firm’s largest investment to date? ObjectivesTo evaluate if investing in Autodistribution is a good option for Butler Capital PartnersTo list down the risks and opportunities of investing in automotive industry To provide a recommendation whether or not to accept Lehman Brothers’ investment proposal.Alternative Courses of Actions Status Quo            Butler Capital Partners will forego the opportunity of investing in Autodistribution. However, they will not be able to take advantage of the gains they can make from the leading independent auto parts supplier in France. They can also save their time and effort in assessing the investment proposal and can concentrate further on the current investments.Other AlternativesACA 1ProsConsConsider the investment proposal of Lehman Brothers to bid a deal in AutodistributionBigger investment portfolio due to the addition of AutodistributionTake advantage of the future growth of the French market by 2% to 3% Security since France was considered as the largest and most mature private equity in Europe.High risk due to the constraints highlighted by Walter ButlerAvailability of financing has been tightChallenge to change the company’s culture from association to a corporationRecommendationOur group recommends Butler Capital Partners to submit their proposal to invest in Autodistribution. There are risks associated to it but there are ways on how to mitigate it. There are also benefits which they can take advantage of once the deal has been sealed. In addition, the French Automotive market is promising and growing in a foreseeable future not only in-country but also within the European market. Factors for growth include the growing number of cars in circulation, an aging car fleet, an increase in technical complexity of car parts, new legislation requiring more frequent compulsory vehicle inspections and deregulation to meet European Standards.