Overview of current events from the past week @ GSB:
In a speech to GSB students at the Gleacher Center, Motorola CEO Ed Zander said his company looked into the possibility of buying Navteq Corp before rival Nokia struck a deal but rejected an acquisition because it wasn’t a good strategic fit. “We looked at it and went on our way,” Zander said. He called the $8.1 billion price tag for Navteq “stunning.”
University professor Steve Levitt, author of the best-seller Freakonomics, was this week's guest at the Harper Center for the Becker Brown Bag Series. He discussed the benefits of running experiments in real businesses, even if many short-sighted CEOs have historically refused to participate in what they perceive to be risky undertakings. He also shared with students his most recent study, which analyzes the economics of prostitution in the United States.
Professor Steven Kaplan was quoted in a Bloomberg article about the slowdown in buyouts. Many private equity firms are now unable or willing to leverage up as they did before, Professor Kaplan said. “Those multiples are dead … The amount of leverage they can get has gone down and will stay down,” he said in the October 1 article.
Professor Raghuram Rajan appeared on The NBC Nightly News with Brian Williams October 10 in a story about foreign investment in U.S. companies. Although some Americans may be leery of such purchases, Professor Rajan says it often makes good business sense. “People don’t spend $10 billion or $20 billion on a company just to run it into the ground or for some nefarious purpose,” he said.
Professor Rajan was also quoted in an October 6 article by The Economist about whether there needs to be more regulation of banks’ liquidity. Professor Rajan said what is needed is consistent monitoring of banks’ liquidity positions over the economic cycle. One benefit of the recent crisis, he said, is that it will provide a benchmark for assessing whether banks have enough liquidity in the future. More scrutiny may be the only way to ensure less reliance on the state.
Timothy Chen, MBA ’91, was named CEO of NBA China, a subsidiary of the National Basketball Association, according to a September 21 Forbes article. There are an estimated 300 million basketball fans in China, the article said. Previously Chen was CEO of Microsoft China.
James Kilts, MBA ’74, was elected to the board of Pfizer Inc., according to an announcement September 27. He is a founding partner of Centerview Partners, a private equity and financial advisory firm and was CEO of The Gillette Company prior to its merger with Procter and Gamble. Kilts is also chairman of Council on the Graduate School of Business, a group of executives that advise Dean Snyder on program issues and serve as a link to the business community.
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