Structure

The key to
clarity and power
in writing

Organizing thoughts into

words, sentences and
paragraphs
Words, the atoms of structure
 Verbs and nouns
 Concrete vs abstract
 Specific vs vague
 Simple vs complicated
 Familiar vs unfamiliar
 Layman's terms vs jargon

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 Verbs and nouns
 Strong verbs = strong sentences =
clarity
The Platinum Futures fund
outperformed bonds.
A fund that is composed of Platinum
futures had performance that was
better than bonds.

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 Verbs = Communication
Power
 Useactive verbs
The swap trading book is the one
that was closed by the broker on
Friday.
The swap trading book is the one that
was closed by the broker on Friday.

The broker closed the swap trading

book on Friday.
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 Nouns
Importance
Forty billion yen in bonds were sold
today by Nippon Steel Corp.

Nippon Steel Corp. sold 40 billion yen

in 10-year bonds today.

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 Make it concrete
Concrete Abstract

rain weather
debt leverage
money funds
compatible synergistic
borrowing costs interest rates
low price cheap

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 Concrete makes it simple,
specific
 Poor
weather may affect rice
farmers’ earnings and leverage.
 Less-than-usual rain may reduce
farmers’ profit and force them to
borrow more.

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 Building blocks of story
 Dramatic structure
--What, why
--Evidence
--Why we should care
--What may happen in the future

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 due diligence
Commerzbank AG, Landesbank Baden-
 Offers to purchase an asset are
Wuerttemberg and DSGV, the savings banks association, handed in
offers for Landesbank Berlin Holding AG, the biggest lender in
usually dependent on the results of
the German capital, said three people with knowledge of the sale.
The three banks met today's deadline after conducting due
due
diligence, according to the people, who did not give details and
declined to be identified because the bids are not yet public.
diligence analysis. This includes
reviewing all financial records plus
anything
else deemed material to the sale.

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 poison pill
 Describes a range of tactics used by public
companies to avoid a hostile takeover.
 One example is the issuance of a preferred
stock that gives shareholders the right to redeem
their shares at a premium after the takeover.
A strategy used by corporations to discourage
a hostile takeover by another company. The
target company attempts to make its stock less
attractive to the acquirer. There are two types of
poison pills:
A "flip-in" allows existing shareholders
(except the acquirer) to buy more shares at a
discount.
The "flip-over" allows stockholders to buy the 10
Business & Finance Writing Summer 2009
acquirer's shares at a discounted price after the
 Private equity
 Private equity
   Equity
Permira, capital
which said that
it expects the offer is made
to start by July
and be completed by September, is acting through its Red & Black
Luxavailable to companies
SARL unit. The private-equity or investors,
interest in Valentino follows
but not
TowerBrook Capital Partners LP's takeover of shoemaker Jimmy Choo
Ltd. in February.
quoted on a stock market. The funds
raised through private equity can be
used to develop new products and
technologies, to expand working
capital, to make
acquisitions, or to strengthen a
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 goodwill
 Goodwill
The company booked abtout 1.1 trillion yen ($9.4 billion) in
An account that can be found in the assets
goodwill, or the amount it paid above the market value of
portion K.K.'s
Vodafone of a net
company's
assets, frombalance
its purchase sheet. Goodwill
in April, the
can often
Nikkei arise
Financial when
reported, one
citing KazukocompanyKimiwada,is purchased
Softbank's
by another
accounting company.
manager. Softbank Inbought Vodafone for 1.8 trillion
yen.
an acquisition, the amount paid for the company
over book value usually accounts for the target
firm's intangible assets.  Goodwill is seen as an
intangible
asset on the balance sheet because it is not a
physical asset such as buildings and equipment.
Goodwill typically reflects the value of intangible
assets such
as a strong brand name, good customer relations,
good employeeBusiness relations and any patents or
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proprietary technology.
 Greenmail
 A spin-off of the term "blackmail", greenmail occurs when a large
block of stock is held by an unfriendly company or raider, who
then forces the target company to repurchase the stock at a
substantial premium to destroy any takeover attempt.
   Nippon Steel Corp.'s poison-pill clauses favor management with
few outside checks on its power, the Financial Times said today in
its ``Lex'' column.
    The ``U.S.-style'' defenses are becoming more common in
Japan after the government allowed them last year, the
newspaper said.
    At Nippon Steel, four kinds of bidders, including greenmailers
and
asset-strippers, can be rejected without a shareholder vote, the
newspaper said.
 The defense itself was implemented without stockholder
approval, the column said.
    Many Japanese ``poison pills'' will ``jeopardize'' a company's
ability to act efficiently, the Lex column said.
    Nippon Steel said yesterday it will work with two of its
competitors to stop hostile takeover bids.
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 Private equity

   Equity capital that is made available to

companies or investors, but not
quoted on a stock market. The funds
raised through private equity can be used
to
 develop new products and technologies,
to expand working capital, to make
acquisitions, or to strengthen a company's
balance sheet.

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 Book value

The accounting value of a firm. It has two main
uses:
1. It is the total value of the company's assets
that shareholders would
theoretically receive if a company were
liquidated.

2. By being compared to the company's market

value, the book value can indicate
whether a stock is under- or overpriced.

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 Takeover bid

When an acquiring company makes

an offer to the target company's
shareholders to buy the target
company's shares in order to gain
control of the business.
Takeover bids can either be friendly
or hostile.

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 Leveraged buyout
 Takeover of a company or controlling
interest in a company using a
significant
amount of borrowed money, usually
70 percent or more of the total
purchase
price.

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 Discount
 The amount below the market price
by which a shareholder is willing to
sell his
stock, or an investor is willing to offer
for it.

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 Premium
The amount above the market price
by which a shareholder is willing to
sell his
stock, or an investor is willing to offer
for it.

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Schott acquired Moritex via a takeover bid (TOB) in October 2008.

Schott, the German-based industrial optical fiber maker acquired

Moritex,
the Japanese optical fiber maker, in April 2009.

Schott, a Germany-based optical fiber maker, acquired

Japanese rival Moritex in April 2009.

When asking about the details of the due-dilligence on this recent TOB
deal,
Schott is attractive to Moritex, given its brand and sales channels, a
Moritex source said, adding that Moritex used to have an issue with its
frequent change of its major shareholders. Thus, Moritex chose a
large-scaled Schott as a stable major shareholder in order to
collaborate on
the optical fiber business , the Moritex source continued.

Schott gains the Moritex brand and distribution, while Moritex

expects the transaction to give it a stable long-term ownership.

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The market cap of Schott is about USD 10bn, but that of Moritex is
just
about USD 100m.

Schott’s market cap is about USD 10bn, about 100 times

Moritex’s USD 100mn.

Schott does not have a strong market share on the machine vision
system with the components such as optical lenses used for the
semiconductor
manufacturing equipment, which would generate a growing
demand as the macro economics recovers, a Schott source said.
However, Moritex was a global market leader on this business
space, which was the main reason of the business partnership with
Moritex, leading to the TOB deal, a Schott source said.

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“That deal was synergetic and for the both Schott and Moritex,” a
Japan-based sector analyst covering this sector said. Moritex, as a
domestic-based company, would prospect a profit via gaining the
global sales
channel of Schott on its optical fiber products, he said, adding that
Schott
would enter into the Japan market on its optical fiber business
where
several Japanese players such as Hitachi and Toshiba dominate its
market.

The optical fiber is the component such as lenses used for the LED
and the
semiconductor inspection equipment, according to the website of
Moritex.

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On 22nd May, USJ, running an amusement park
“Universal Studio Japan” in Osaka, presented that a
takeover bid was completed by a head of shareholders
SG Investments, a group of Goldman Sachs.

Goldman Sachs’ Japanese private equity unit

acquired Osaka-based Universal Studios Japan on
May 22 to attract more customers by improving
the amusement park’s facilities.

The takeover bid was implemented between 23rd March

and 21st May. 98.8% of voting shares was made into it.
USJ expects to be delisted from Tosho Mothers. Gren
Kanpel, President of USJ, continues to be the position and
lead the company. He will focus on growing a profit, by
spending on the company’s facilities and attracting large
number of customers.

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On 19th May, Japan Airport Building presented to implement
share-buy back scheme, limited to 22% (22,000,000 shares)
issued stocks. After approval at the shareholders’ meeting, JAB
will start stock buyback through a takeover bid. Macquarie
Group, Australian investment fund, has owned 20% of the share
as a head of shareholders. Macquarie expects to sell off all
shares at the takeover bid.

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 An amount per sharer is 1,000 yen
and 4% premium more than the
closing price on 19th. The date of
TOB will be from 30th June to 28th
July. The fund of purchasing shares
will be supplemented with their own
funds and debt payable.

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 Macquarie has started to own the
share of JAB since 2007, and
acquired 19.9% at the end of March
in 2008. On the other hand, since JAB
has made a measurement against
takeover bids, both have been
deadlocked. According to the report
of the big owners of shareholder,
Macquarie will sell off the shares
involving a loss at the average share
acquired price 2,289 yen.
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