Raising Capital Essay

Question 1
Five to Seven Points

• 30 January 1986, Jobs purchased the Lucas film computer division and Pixar only had forty employees for the estimated value of $10 million.
• The integration of computer animation into the commercial advertising spots for Tropicana, Trident and provide Pixar with the cash to foot their bills and pursue the artistic issues
• Pixar was unprofitable and was getting impatient with the inability to model and monetize the technology and create the required cash.
• Pixar listed shares in the initial public offering per year and sold approximately $132 million in stock for $22 per share.
• Steve Purchased the company from Lucas film for $10 million and invested an additional $60 million in the company of the 100% of Pixar’s shares
• Pixar went public since it had 96.3 million shares outstanding and 80% of those were held by Steve Jobs

Question 2: Funding Water Fall For Pixar

• Jobs’ acquisition of Pixar from Lucas film : 10 Million and investment of 60 million of the company
• ̡Jobs’ funding of Pixar :96.3 million shares outstanding with 80 percent of the shares
• ̡Pixar’s public listing : share option valued at $22 per share
• ̡Disney’s acquisition of Pixar : $7.4 billion

Question 3:
At the time Steve Job was acquiring or Purchasing from Lucas film at $10 million and invested an extra 60 million, Furthermore, during the time the firm was going public, it had 100 per cent of Pixar shares with a market price of $22 per share. Pixar Purchased Disney at an estimated value of $7.4 billion. The company’s value of the wealth was 132 million stock sold at $22 per share. At the time of the stock deal, Steve Jobs owned more than 70 per cent of the shares, and in 2007 the company held approximately 138,000,000 of Disney which represented a 7 per cent stake in the company. However, in 2006 Disney stock market price was $30 per share and cost more than $4 billion. The estimated sales of the current value are $13.3 billion.

Question 4
Steve Jobs has a stake in the company and is valued at $13.3 billion and an estimated return of 13.5% per annum. The 8 million shares of Disney was having an estimated $5.12 per share, but the return increased to almost 14 per cent. The Disney value was $13.3 billion from the investment, which increased by 220 times from the investment in Pixar costing $60 million. The Pixar shareholders will acquire 2.3 shares of Disney.

Question 5
Disney and gather the appropriate multiples 2005 and 2006. The ten multiple price-earning is as shown below

Valuation: Price to Sales

Based on the valuation of the firm, I believed Disney paid a lot of money to the Pixar. This is because price-earnings and the earnings multiple for the acquisition are relatively higher than anticipated. The implication is that Pixar will obtain 2.3 shares of Disney for every Pixar stock. The value is estimated at 13.3 billion, which is above the 4 million valuations for Pixar. However, this is expected to grow in 2006 since the market price of the stock will rise to $36.