Global MBA teams explore exit strategies in Private Equity case competition
Students from the International Full-time MBA at Rotterdam School of Management, Erasmus University (RSM) welcomed 89 MBA students from 18 top business schools worldwide to the Netherlands for RSM's annual two-day Private Equity Case Competition in November 2017.
The two days revolved around the theme of what makes a successful exit strategy and the importance of building a compelling equity story towards potential buyers.
The realistic private equity case, based on publicly available data, which students received two weeks before the event, was about a UK-based PE firm that purchased a typical Dutch retail chain 10 years ago. The teams’ problem statement was to figure out whether it was the right time to sell the company and if so, whom should they sell it to and at what price.
The event started with a symposium sponsored by Dutch bank ABN AMRO at its head office in Amsterdam on 17 November 2017. Speakers included Barbara Stam, head of financial restructuring and recovery, ABN AMRO; Gert Jan van der Hoeven, founder and managing partner, H2 Equity Partners; Machteld Groeneveld, director corporate strategy, CMIS group; and Annemarie Jorritsma, chair, Dutch Private Equity Association, NVP).
In teams of four or five participants, the MBA students had analysed various exit scenarios, listing potential buyers and recommending ideas for restructuring before an exit. The teams presented various outcomes for this case from the perspective of the private equity firm, which resulted in a rich dialogue between schools and judges and showcased how complex structuring a compelling equity story can be. MBA student from University of St. Gallen, Sebastian Reinecke, said: “The breadth of the case study allowed us to tackle the case from many different angles and not only stick to a plain vanilla divestment proposal.”
The judges chose the University of Toronto’s Rotman School of Management as the winning team, based on strategy, presentation and financial analysis. The winner recommended the PE company to partner with another PE firm, which owns a leading Dutch online retailer in fashion and other supplementary products. A joint venture with a Dutch online retailer would support the development of the omni-channel strategy of the company.
The jury members were Hans Haanappel, private equity lecturer at RSM and partner at Fair Value; Jonathan Kahn, CFO, America Today; Ronald Latenstein, CEO, Sailfish management; Felix Zwart, research and regulatory affairs, Dutch Private Equity Association, NVP; Bas Kea, investment manager, Avedon Capital Partners; Solomon Zori, assistant professor accounting and valuation, RSM; Martin Kerkhof, director commercial due diligence and data analytics, PwC; Keith Black, managing director, CAIA association; Thomas Maurel, managing partner, Valery Capital; and Emke Bus, managing director ESG and infrastructure, GRESB.
European retail market leaders
MBA student Deepak Kurian from Rotman School of Management said: “I learned a lot about working with a team, managing time efficiently and communicating effectively. And, we also were exposed to the European retail market and the PE industry there. As it was all new to us, we learned a lot through our research for the case.”
His teammate Ali Jafri added: “My initial understanding was that the European markets would be similar to the USA and Canada as the same financial tools are utilised. But the cultural and social intricacies make the markets inherently different.”
He said the case presented at the competition helped his team learn about the unique characteristics of European markets in the consumer space. “And we could also create working relationships with professionals and likeminded MBA students from various countries to assess the importance and impact of PE firms in their home countries.’
The 18 top business schools participating: IESE Business School, IMD Business School, London Business School, ESADE Business School, Cambridge Judge Business School, China Europe International Business School (CEIBS), SDA Bocconi, HEC Paris, INSEAD Business School, RSM, Rotman School of Management, The Chinese University of Hong Kong (CUHK), Ivey Business School, Copenhagen Business School, Imperial College Business School, University of St. Gallen and Georgetown University McDonough School of Business.
It was the eighth time that this annual RSM MBA student-organised event challenged top finance talents to put their skills to the test with an original private equity case.
Rotterdam School of Management, Erasmus University (RSM) is one of Europe’s top 10 business schools. RSM provides ground-breaking research and education furthering excellence in all aspects of management and is based in the international port city of Rotterdam – a vital nexus of business, logistics and trade. RSM’s primary focus is on developing business leaders with international careers who can become a force for positive change by carrying their innovative mindset into a sustainable future. Our first-class range of bachelor, master, MBA, PhD and executive programmes encourage them to become critical, creative, caring and collaborative thinkers and doers. Study information and activities for future students, executives and alumni are also organised from the RSM office in Chengdu, China. www.rsm.nl
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