Monday, November 26, 2007
Thermo Electron- Question #1 Jason Shaker
Thermo Electron's unusual diversification strategy has created value for the company and its shareholders by drawing on its R & D know-how to develop radically new products that address discrete market niches not alrady addressed by the company or its subsidaries. These products are then spun out as the core of stand-alone companies in which Thermo holds a major equity stake. Between 1983-198, Thermo Electron produced twenty three such spinouts, all but three of which were publicily traded. In the process, Thermo diversified into a wide range of businesses (including power plants, artificial hears, and laser hair removers) and grew its sales over 3.6 billion.
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3 comments:
Thermo Electron-Question #2 Pete Wilsoon
Some significant drawbacks of this type of strategy is that the company's multiplication of subsidiaries has given rise to a corporate structure that looks more like an intertwind strand of DNA than a typical chain of command. That complexity can have a dampening effect on share price. Some investors have complained that the corporate structure is too complicated. Having twenty-three public subsidiaries means producing twenty-three annual reports and filing ninety-two quarterly earnings statements a year. Also, bad performance by one subsidiary can cast a shadow over the whole company and adversely affect both revenues and share price.
Thermo Electron- Question #3 Jeff Scott
Yes, the problems do invalidate the strategy because there was disappointing finanacial results and a performance slump. Also, some subsidiaries may have rushed to market products that were not adequately engineered or tested. The results of this included very slow sales and product recalls that have reflected poorly on the entire corporation which obviously hurts the company tremendously. Eventually some subsidiaries were sold, closed or consolidated into the larger entity.
Thermo Electron # 4 Adam McClellan
Things I learned about Thermo Electron...
1. Thermo Fisher Scientific has long been a leader in the instruments industry. But you may have known them by 50 plus different names.(Aeonic,Bicron,Cytomat etc.)
http://www.thermo.com/com/cda/landingpage/1,,2,00.html
2. Thermo Electron will be coming to a city close by in Boston putting on a large exibit Nov 27-29.
http://www.thermo.com/com/cda/landingpage/1,,2,00.html
3. As of 4/26/07 at 4:oopm the stock of the company TMO is at 56.50 and dropped .71 for the day.
(AOL Money)
4. I learned on there home website you are able to purchases many of there thousands of products.
http://www.thermo.com/
5. Also they are a very enivronmentally causious they use and sell air quality control products.
http://www.thermo.com/
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