Write-up Assignment for The Acquisition of Consolidated Rail Corporation Case
Due: Wednesday, January 28, 2004
Your write-up should take the form of a two-page executive summary. You may attach
and reference as many supporting materials as you need, but your conclusions and
reasoning should be self-contained in the executive summary. If you make extensive use
of spreadsheets, you are encouraged to email the Excel files to me as well as including
the printed sheets in your supporting materials.
Objectives of your analysis:
1. Discuss the economic rationale of Norfolk’s bid. This includes how the merger
would benefit Norfolk as well as the impact of a CSX-Conrail merger on Norfolk.
Is doing-nothing a zero-NPV action?
2. Determine the valuation impact of the projected merger synergies. Critically
evaluate the assumptions underlying such an analysis and compare the valuations
to the multiples valuations from part A of the case.
3. Based on your analysis in points 1 and 2 and our discussion of part A, state your
opinion as to the advisability of each of the bids from the standpoint of the bidder
(i.e. would you advise CSX to bid $102.16 and NS to bid $115.00).