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Eaton Corporation

The document contains two requests for analysis and recommendations. The first asks to estimate the weighted average cost of capital (WACC) for Eaton Corporation and its Hydraulic business separately, and advise on whether Eaton should accept an offer for the Hydraulic business. The second focuses on estimating the value of a pediatric practice called Mary Washington Pediatrics using different valuation methods, and recommending an opening bid amount and maximum bid for the practice that considers using debt financing.

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Kym Latoy
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292 views1 page

Eaton Corporation

The document contains two requests for analysis and recommendations. The first asks to estimate the weighted average cost of capital (WACC) for Eaton Corporation and its Hydraulic business separately, and advise on whether Eaton should accept an offer for the Hydraulic business. The second focuses on estimating the value of a pediatric practice called Mary Washington Pediatrics using different valuation methods, and recommending an opening bid amount and maximum bid for the practice that considers using debt financing.

Uploaded by

Kym Latoy
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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EATON CORPORATION

1. Estimate the WACC for the Eaton Corporation and the Hydraulic business separately.
2. Estimate the value of the Hydraulic business and advise management as to whether they
should accept the offer on the table.

Mary Washington Pediatrics


1. Are you comfortable with Atwood’s forecast in case exhibit 3? Do you
think its feasible?
2. How could you use the past internal medicine practice transaction to
estimate a credible bid price for Mary Washington pediatrics?
3. How could you use a DCF based estimate for the value of the practice?
a. Based on case exhibit 3, what is the free cash flow expected for each
year?
b. How would you estimate a terminal value for the practice in 2023?
4. What amount would you recommend that Atwood and Juarez submit as an
opening bid on the practice? If their offer is rejected , how high should they
be willing to go?
5. How concerning is the need to use debt to finance the deal? The current
owners have no debt in the practice. Is it better for the practice to have no
debt?

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