Cooper Industries Analysis OVERVIEW: Cooper Industries is a broadly diversified manufacturer of electrical and general industrial products, as well as energy-related machinery and equipment. The company operates in three different business segments with 21 separate profit centers. These segments include electrical and electronic, commercial and industrial, compression, drilling and power equipment. The product line consists of inexpensive fuses up to $3 million compressor stand sets along with products such as hand tools and lamps. The company made a $21-per-share tender offer to acquire automotive spark plug maker Champion SparkPlug as a counteroffer to Dana Corp.'s $17.50-per-share offer. Also, meanwhile, Cooper Industries was considering a $700 million bid for Cameron Iron Works. While purchasing one or both companies would bring operational and organizational benefits, the financial risks were high. Making both acquisitions would result in a debt-to-capitalization ratio of between 55% and 60%. ANALYSIS: Cooper Industries acquired more than 60 manufacturing companies over a thirty-year period in order to increase the company's size and reach. Most of the acquired companies made it possible for Cooper to be independent from the external environment and give full control of the production process related to its business while avoiding antitrust charges. Cooper has essentially purchased all the companies vital to its energy sector and all the collateral industries that affect it. From tools to fuses, cables to drilling equipment, they were produced and distributed by divisions of the company. Each acquisition is decided by a wish list that has been carefully examined and researched. At the time of the takeover, the Management Development & Planning division would implement the corporate strategy in a period of three to five years. This involves diversifying and eliminating products that are poor sellers. In some cases the production facility is relocated and personnel are reorganized to ensure maximum efficiency. Over time all these companies will turn into profit centers. RECOMMENDATIONS: One of my first suggestions will be to consider Cameron Iron Works first as all valves and other oil and natural gas products will be more beneficial. Apparently there is more demand for Cameron's products than those of the Champions League. Small adjustments in the production process along with the adjustment of "Cooperation" will make the company efficient in a short period of time. Instead, Champion is believed to have 1950s manufacturing techniques and only one product line, spark plugs, which will require huge changes within the company. The other option could be to buy both companies, independently