14 Pages Posted: 27 Jun 2000
SUBJECT AREAS: Corporate objectives, asset control, takeover defenses, valuation.
CASE SETTING: February 2000, Burlington, Vermont.
This case examines issues of asset control for Ben & Jerry's Homemade, Inc. in light of the outstanding takeover offers by Dreyer's Grand, Unilever, and Meadowbrook Lane Capital in February 2000. The case provides a unique opportunity to discuss fundamental firm objectives and the implications of a non-traditional corporate orientation. The case reviews the development of Ben & Jerry's strong social consciousness and the takeover defense mechanisms that maintain management's control on company assets. Taking the role of an outside board member, students are invited to review management's performance, estimate the economic cost of its social agenda, and evaluate the implications of takeover defense strategies. Ultimately the students must take a position on whether Ben & Jerry's should continue to independently pursue its social agenda or accept one of the attractive takeover offers and accept a shift toward greater profit orientation.
The case provides opportunities for the instructor to develop any of the following teaching objectives:
- Review the role of corporate objectives and the merits of profit and non-profit orientations.
- Stimulate an appreciation for the tension regarding asset control among corporate stakeholders.
- Evaluate the role of corporate takeovers and the merits of takeover defenses.
- Introduce corporate valuation using investor multiple measures.
The case requires relatively little prior finance knowledge and is designed largely to provide a stimulating introduction to the principles of a traditional corporate finance curriculum.
JEL Classification: G30
Suggested Citation: Suggested Citation
Schill, Michael J., Ben & Jerry's Homemade. Darden Case No. 1364. Available at SSRN: https://ssrn.com/abstract=234691