This 8 page paper is based on a case study supplied by the student looking at the problem faced by a company whose supplier is potentially subject to a hostile take over bid and is considering acquiring the supplier. The paper performs a gap analysis. Looking at the issues, the stakeholders, the desires position and the way it may be achieved. The bibliography cites 3 sources.
Name of Research Paper File: TS14_TElester.rtf
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distribution contract with Shang-wa. They supply Lester under an exclusive contract where they will not knowingly supply any other companies selling in the US. The contract is renewed each
year. The contract has benefited both companies, and the two CEOs and founders have become friends as well as business associates. John
Lin wants to slow down and eventually retire, but he has no apparent successor and his company has become a potential take over target of TEC a larger company in
the same business. John does not appear to be happy about this, he wants his company to end up in safe hands. However, the impact for Lester Electronics Inc.
could be devastating, the business was built in the exclusive supplier agreement and if Shang-wa is taken over by TEC it is unlikely that this agreement will be renewed
as it will not be in the interests of TEC who have a history of acquiring companies in order to grow. For Lester the calculations mean that they are likely
to loose at least 43% of their revenue over the next five years John Lin has suggested to Bernard Lester that undertaking
a joint venture may help both companies, he is also now concerned that if TEC make a hostile bid for Shang-wa it could move quickly and there would be little
he could do about it. John has supplied Bernard with the details of the bid that TEC are making and is holding them off to give John a little time
to assess the potential of the deals. The situation is that Lester Electronics Inc are in a difficult position, they have relied on Shang-wa for an exclusive supply of