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Chapter 11 Closing Case – Emerging Markets: The Private Equity Challenge 1 Chapter 11 Closing Case – Emerging Markets: The Private Equity Challenge University of the Incarnate Word PMBA 6317 – Global Strategies/Policy/Regulation Dr. Murat Tash Melody Colunga April 09, 2024

Chapter 11 Closing Case – Emerging Markets: The Private Equity Challenge 2 1. If you were a private equity specialist, what kind of target firms would you look for? As a private equity specialist, I would look for target firms that have the potential to generate significant returns for investors. This would include firms that have strong growth prospects, a solid financial position, and a competitive advantage in their respective markets. Some specific sectors or industries that could be attractive for private equity investments include technology, healthcare, consumer goods, and financial services. Additionally, I would look for firms that have a track record of successful operations and an experienced management team. Overall, I would look for companies that have strong fundamentals, growth potential, and the potential to generate returns for investors. As a private equity specialist, I would look to invest in profitable, growing companies with strategic investment potential, turnaround opportunities, and a diversified portfolio to reduce risk. 2. If you were CEO of a publicly traded firm and were approached by a private equity firm, how would you proceed? As the CEO of a publicly traded firm and approached by a private equity firm, I would proceed by carefully evaluating the proposal and considering the potential benefits and risks involved. It is important to understand the terms of the offer, including the valuation of the company, the amount of equity to be acquired, and the timing of the transaction. Additionally, I would seek advice from trusted advisors, such as investment bankers or legal counsel, to ensure that I am making an informed decision. It is also important to consider how the transaction would impact on the company's existing shareholders and employees, as well as its prospects. You need to understand what they are suggesting by looking at the offer price and deal terms. Check if it fits well with the company's long-term plan. Look over the investors by ensuring their

Chapter 11 Closing Case – Emerging Markets: The Private Equity Challenge 3 past performance and financial stability is sound. Compare their offer to the current market value to see how it affects the value for shareholders. Think about other options, talk about the terms, and keep everyone involved in the decision-making process. Only go ahead if the deal is good for the company. This way, the CEO can make a well-informed decision by considering the possible benefits and risks. 3. If you were a Chinese regulator, how concerned should you be after you have learned about the criticisms against private equity in the United States, Germany, South Korea, and elsewhere? Private equity has been the subject of criticism in many countries for its alleged role in exploitative practices, lack of transparency, and negative impact on societies. Therefore, Chinese regulators should be cautious and ensure that the Chinese private equity industry operates responsibly and sustainably. As a Chinese regulator, I would be concerned about the criticisms against private equity firms in other countries, particularly in terms of their impact on the economy and society. Private equity firms have been criticized for their role in leveraged buyouts, which can lead to the loss of jobs and the decline of publicly traded firms. Additionally, there are concerns about accountability in private equity firms, as well as the potential for them to engage in fraudulent or unethical practices. As a regulator, it is important to ensure that the activities of private equity firms follow the law and that they are not harming the economy or society. Chinese regulators should ensure that the Chinese private equity industry operates responsibly and sustainably, complying with all the relevant regulations and laws, operating transparently, not engaging in any predatory practices, and not engaging in any activities that may be considered to violate the Chinese laws and regulations.

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Chapter 11 Closing Case – Emerging Markets: The Private Equity Challenge 4 References Peng, M. W. (2022). Global Strategy (5th ed.). Cengage Learning US. https://bookshelf.vitalsource.com/books/9798214344669