Read PowerWater Beverages, Inc. case. Take a viewpoint and re-analyze the company. In doing your analysis, you may use outside information, but keep in mind that any market information should correspond to the timing of this case (2006).Remember, this is the final project for the class and your opportunity to display your mastery of all of the subjects covered in class. Please be sure to show your work and explain each decision and assumption you are making.
Your job is to decide whether or not the management of PowerWater is making good decisions.
- Funding request: Has management identified the correct amount of money required? What is the runway for this business if they get the investment? What is the runway without the investment? – 25 points
- Based on the amount of investment you have identified as correct, what is the impact on the current owners and the capital structure if this new investment is accepted? – 25 points
- Does this venture still make sense to proceed with? Is PowerWater a good opportunity? – 25 points
- If the company finds an investor, describe the terms that you would expect to receive. Pay special attention to the amount of money changing hands, the ownership shares, and the covenants included in the agreement. – 25 points
Remember to pay close attention to the instructions and make sure you are as in depth as possible. You necessarily need to discuss the percent of ownership you will be giving up or purchasing, which necessarily requires you to find a specific valuation for the company.