Shurgard Self-Storage: Expansion to Europe Harvard Case Solution & Analysis

Shurgard, the American firm that rents storage services to consumers and small businesses, is considering funding options for the rapid expansion of its operations in Europe. Five years after the entry of Europe, Shurgard Europe opened 17 facilities in Belgium, France and Sweden. Along the way, Shurgard has faced skepticism and European consumers and investors unfamiliar self-storage concept and the internal debate about how much U.S. business model to adapt to the European way of life. Wall Street analysts also do not appreciate the impact that European expansion could have on U.S. productivity Shurgard as a publicly traded Real Estate Investment Trust (REIT). Alternatively, to finance this expansion, Shurgard was proposed deal with a consortium of banks and other investors, where they will provide funding of private capital located in the next few years, plus a credit line. In turn, investors would receive a larger share of capital Shurgard and control of his reign, that would make the public offer in less than two years. Attention from the decision, Shurgard Europe must accept the terms and evaluation of the proposed transaction, or look for another deal at a later point in time. Students should assess whether self-storage business model can provide growth in Europe, the company promised to potential investors. Includes calculation of some of the basic valuation of the financial items (enterprise value using several pEBITDA). The main focus is to evaluate this as a business venture. Students should be familiar with the REITs.
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by Richard G. Hamermesh, Indra A. Reinbergs Source: HBS 29 pages. Publication Date: Mar 02, 2004. Prod. #: 804112-PDF-ENG

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