Katie Lenzini

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CASE 1 Presentation

• Katie Lenzini
• Jeremy Epstein

February 27, 2007
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Background Info

• Started in 1978 in Burlington, Vermont
• Founders Ben Cohen Jerry Greenfield
• Spent 5 learning how to make ice cream
• Bought an old gas station and opened shop
• Initial Investment 12,000 (4,000 borrowed)

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Timeline

• 1980 started distributing pints in grocery stores
• 1984 Vermont Only stock offering
• 10.50 x 75,000 shares 787,500
• Used to build new factory
• 1985 NASDAQ IPO
• 13 x 450,000 shares 5,850,000 market cap
• 1992 Additional Stock Issued
• 30.50 x 1,265,000 shares 38,582,500
• August, 2000 Acquired by ___________

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A) DREYERSB) UNILEVERC) MEADOWBROOK LANE
CAPITALD) CHARTWELL INVESTMENTS
Who acquired Ben Jerrys?
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UNILEVER
43.60
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Mission Statement Analysis

• Product
• Did they fulfill their mission statement?
• Economic
• Did they increase value for shareholderswas
  there anything that prevented this?
• Social
• What ways did they help the community?

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How did they help community?

• Ben and Jerrys Foundation
• Donates minimum 1.1 million per year
• Green Team
• Focuses on environmental concerns
• CAT (community action teams)
• Get employees involved in service projects

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Takeover Target?

• Slowdown in growth
• 45 share of market
• Already had existing infrastructure
• Strong, developed brand name
• Very low debt ratios
• Debt-equity ratio 18.68
• Debt-ratio 15.7
• Return on Equity 8.9
• Can get better return in market
• Donated 7.5 to charityinefficient use of
  earnings?

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Stakeholders

• Employees (specifically management)
• Suppliers
• Charities
• Shareholders
• Social Mission

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Fair Market Value
Average industry P/E ratio 23.92
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What happened with acquisition

• April 12, 2000 Unilever announced it would
  acquire Ben Jerrys Homemade at 43.60 per
  share for 8.4 million outstanding shares (thats
  over 300 million for ice cream!!)
• Maintained Independent BOD, but replaced Ben
  Jerrys CEO with Unilever employee a few months
  later

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Social Mission Under Unilever

• Following acquisition, Ben and Jerry ceased
  involvement because they felt Unilever just used
  social mission as marketing ploy
• In 2005, new CEO took over Ben Jerrys business
  and made effort to focus on social mission,
  resulting in Ben and Jerry becoming involved
  again
• Since then, Ben Jerrys continues to support
  community and donate portion of earnings to
  charity

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What is your favorite flavor?

• Cherry Garcia
• Phish Food
• Chunky Monkey
• Chubby Hubby
• Other

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Questions?

• Information came from Ben Jerrys website,
  Unilevers website, and www.msnbc.com