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MGMT 495 Summer 2011: Kelly Bossolt Marta Kovorotna Sarah Smith

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Presentation on theme: "MGMT 495 Summer 2011: Kelly Bossolt Marta Kovorotna Sarah Smith"— Presentation transcript:

1 MGMT 495 Summer 2011: Kelly Bossolt Marta Kovorotna Sarah Smith

2 Executive Summary Financial Analysis The market crash time line
Gerson Lehrman Credit Suisse & GLG alliance Credit Suisse and competitors External Analysis A Look at Each Company The Deal Competitive Advantage Internal Analysis

3 Financial Analysis: The Market Crash Time Line
October 2004: Roots of Capital Market Crisis SEC lifted debt restrictions on 5 major investment banks Assumed debt in major excess of cash reserves Increased leverage 40x higher than cash reserves October 2005: U.S. housing market boom began to drop April 2007: Industry collapsed 25 subprime lenders declared bankruptcy October 10, 2007: Record high opening of 14,165 October 2008: Opening down to 8,569 Fannie Mae & Freddie Mac taken over by U.S. Treasury Dept. Merrill Lynch sold to Bank of America Lehman Brothers went into Chapter 11 bankruptcy Dow Jones fell 504 pts September 2008: Government took over AIG IMF deemed this a “major global downturn” Banks worldwide cut rates to boost world economy

4 Financial Analysis: Gerson Lehrman Group (GLG)
Sustainability through tough times: 2006 Revenue up 30% a year on average since 1999 Total Revenue $189 million 2007 Total Revenue $233 million 2008 90% of revenue from financial services, 80% inside the U.S. 90% client renewal rates Total Revenue goal of $284 million

5 Financial Analysis: Credit Suisse
The Alliance with GLG: Thought to generate $100 million in global commissions Save Credit Suisse up to $5 million on own consulting agreements

6 Financial Analysis: CS against competitors
Company PE ratio Debt-to-Equity Return on Equity Credit Suisse 9.82 1,118.53 10.57 Morgan Stanley 39.71 703.71 7.42 Goldman Sachs 13.31 672.86 10.37 Industry 42.9 292.51 6.41 Company Total Revenue: 2010 Total Revenue: 2009 Credit Suisse 54,048,000 50,003,000 Morgan Stanley 31,622,000 23,434,000 Goldman Sachs 39,161,000 45,173,000

7 Internal Analysis: Credit Suisse
Leading Global Financial Services Firm 300 Equity Research Analysts Company & Business Model Research Published Reports with Investment Advice Peers Relationship Database Supply Chain - Ecology

8 Internal Analysis: GLG
Largest Expert Network 200 Executives, Physicians, Scientists, Engineers, etc. Transaction Driver, not Relationship Based Experts managed projects through GLG 6 Vertical Sectors, 2 Horizontal

9 Internal Analysis: The Deal
Goldman Sachs Hudson Street Initiative Credit Suisse Improved Information flow Access to Unique Resources Cost Savings 200,000 expert network Differentiate & Grow GLG Growth Added Experts Strengthen position as Comprehensive Marketplace Expertise Match clients with experts better

10 Internal Analysis: Competitive Advantage
First Movers Branding Comprehensive Marketplace Experts

11 Recommendations Keep doing what they are doing!


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