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Author Topic: Homework Altria-Kraft Case  (Read 1008 times)

Offline Christopher

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Homework Altria-Kraft Case
« on: March 15, 2010, 07:06:12 pm »
1.In which business is Altria?

Is a conglomerate and one of largest tobacco corporations of the world and sells tobacco products under the Name L&M and Malboro. But also owns 28.6% of the brewery SABMiller plc

2.Descrivbe the international finance issues regarding purchase and sale of Kraft by Altria.

Purchase: risk of boycott due to the Aquisition of a food company by a health damageing tobacco company. This together with the legal setbacks caused a overall underperformance of Kraft during the conglomerate with Altria.
Sale: After first sale of 16% of stocks, both companies stock prices rose.Then Krafts share remaind steady evene after the sale by Altaria whereas Altarias share price rose steadily thereafter

3.What are Krafts products?

Package food and beverages under brands such as: Jacobs Coffee,Philadelphia,Milka,Oreo etc.

4.Comment on the two stage spinnoff of Kraft by Altria.

The first spinn off has been done in secret and has benn a great success for both companies since both their stock prices rose afterwards.
Prior to the Second spinnoff, Kraft shares hab stayed stable for a couple of years after the spinoff ahre price declined and was only recovered by a future investment plan presented later that year.Thereby Krafts share remained on a steady level whereas Altrias share price continued to grow.