Kellogg students top buyout case competitionBy Dan Campana
Hard work and a balanced approach – and a bid to buy Abercrombie & Fitch – lifted a team of Kellogg students to victory in Wharton’s 14th Annual Private Equity Buyout Case Competition.
The team of Emma Gergen ’14, Garrett Greer ’14, Ben Kaplan ’15, Keith Roux ’14 and Andrew Welch ’14 took first place out of 26 teams from 21 MBA global programs in the annual event, which is the largest MBA-level private equity case competition in the world.
This year’s competition, which was recently held in New York, called on teams to analyze Abercrombie & Fitch and design a 30-minute presentation detailing a plan to purchase the company.
“You’re presented only with a company name and the question of whether you would invest in that company,” Greer explained.
Team Kellogg won for its approach to key value creation strategies for improving the company’s profitability, as well as its purchase price and financing recommendation, Greer said.
“You do not have opportunities to compete against students from other prominent MBA programs in the real world,” Greer said. “It was an excellent learning experience.”
The Kellogg team came into the event with a nice variety of real-world experiences: private equity, investment banking, legal and management consulting.
They soon recognized the value of being able to apply personal business experience and their Kellogg educations in a realistic environment.
“It’s actually fairly realistic,” Gergen said of the timeframe and scope of the research required to make an investment decision.
Over the course of five days leading up to the event in New York, team members spent considerable time digging into Abercrombie’s corporate filings and then narrowed their focus on its general business model and brand-specific strategies for improvement.
“We put a tremendous amount of work into our presentation, but the time absolutely flew by and it was all obviously worth it,” Greer explained, noting everyone on the team individually spent 40 to 50 hours on plan development and designing the presentation.
Winning the day
The initial round featured 26 teams doing their half-hour presentations for a panel of judges from the private equity industry. The four finalists presented in front each other, giving teams a chance to see what everyone had put together. The Kellogg team feels that its differentiated approach was key to its victory.
“We probably took the deepest dive into our value creation strategy, which involved rationalizing Abercrombie’s store count, replacing certain members of management, and reviving the brand through a variety of new marketing strategies,” Greer said. Greer and Gergen, who are both in the one-year accelerated MBA program, said Kellogg’s success at Wharton is a testament to the school’s diverse business offerings.
“I think that Kellogg has a lot to offer the private equity community. We need to showcase that,” Gergen said.