Distressed M&A and Corporate Strategy: Lessons from Marvel Entertainment Group's Bankruptcy

Strategy & Leadership, Vol. 37, No. 4, pp. 23-32, 2009

Posted: 1 Jul 2009

See all articles by Joseph Calandro, Jr.

Joseph Calandro, Jr.

Fordham University - Gabelli Center for Global Security Analysis

Date Written: June 28, 2009

Abstract

Purpose: This paper illustrates the viability of distressed M&A by way of case study utilizing the modern Graham and Dodd valuation approach.

Design/methodology/approach: The paper presents a distressed acquisition case study of the 1996 Marvel Entertainment Group (Marvel) bankruptcy. It draws on previously published Graham and Dodd methodological materials as well as a financial case study of Marvel that was prepared at the time. The valuation presented in this paper is the sole work of the author.

Findings: The case study supports the view that distressed M&A can be a viable corporate strategy alternative. It also demonstrates how a multi-layered valuation approach such as Graham and Dodd can be ideal for identifying value that may be hidden in the confusion and distress of bankruptcy.

Practical and research implications: The case study illustrates, first, the viability of distressed M&A as a corporate strategy alternative, and second, the valuation insights that the modern Graham and Dodd approach can produce in a distressed setting.

Originality and value: This is the first paper that we are aware that applies Graham and Dodd-based distressed M&A valuation to corporate strategy.

Keywords: vulture-investing, distressed M&A, Graham and Dodd, Marvel Comics bankruptcy

JEL Classification: G34, L20

Suggested Citation

Calandro, Jr., Joseph, Distressed M&A and Corporate Strategy: Lessons from Marvel Entertainment Group's Bankruptcy (June 28, 2009). Strategy & Leadership, Vol. 37, No. 4, pp. 23-32, 2009. Available at SSRN: https://ssrn.com/abstract=1426826

Joseph Calandro, Jr. (Contact Author)

Fordham University - Gabelli Center for Global Security Analysis ( email )

531 Hughes Hall
441 E. Fordham Rd
Bronx, NY 10458
United States

HOME PAGE: http://www.linkedin.com/in/josephcalandro/

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