Ceo Case

In this simulation, each student plays the role of CEO at one of three publicly traded wine producers: Bel Vino, Starshine, or International Beverage. Each role evaluates merger and acquisition (M&A) opportunities among the three companies and then initiates and responds to bids and counterbids. Data provided to players include historical stock prices for each company and operating projections based on Wall Street analysts’ current views of the industry and of each company’s prospects. The simulation also includes online chat functionality so that students can negotiate with one another ‘‘live,’’ even if they are not face-to-face. Public bids and real-time changes in stock prices heighten the sense of competition among the three players. A scoring system allows performance to be assessed, even when no deal is reached.

As CEO, each player has authority from the company’s board of directors to negotiate possible business combinations. Each player’s primary objective is to maximize shareholder value for his or her company. The scoring scheme complements this objective by rewarding sound analysis and value creation, deals that make economic sense, and by awarding no penalty for not doing a deal unless a sensible one was passed up.

• Bel Vino: The player assumes the role of CEO of Bel Vino, with authority from its board of directors to negotiate possible business combinations. The two available possibilities are a stock merger with Starshine or an acquisition for cash consideration by International Beverage. The objective is to maximize value for Bel Vino’s shareholders.

• Starshine: The player assumes the role of CEO of Starshine, with authority from its board of directors to negotiate possible business combinations. The two available possibilities are a stock merger with Starshine or an acquisition for cash consideration by International Beverage. The objective is to maximize value for Starshine’s shareholders.

• International