Tottenham Spur Plc Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Tottenham Spur Plc Case Study Help

Signing new Strikers:

The strategy will increase the net goals of the team by 12, making the new average net goal of the club to 10 which is greater as compared to the new goals of New castle and Everton. The new striker will improve the quality of the team and the team’s ranking in the premiership which will ensure that the fans of the team players to attend the matches in order to support their favorite players hence, resulting in increased revenues.

However, the number of fans attending the matches or visiting the stadium will be restricted due to limited housing capacity which will restrict the revenue of the club. Considering, limited additional revenue will be generated from the proposed strategy, paying off the debt borrowed to fund the transfer fee and other costs associated with the strategy might be difficult. Moreover, significant salaries will need to be paid to the new strikers and the transfer fee appears to be irrecoverable which is specified in the case study. On the other hand, in case of injury to the main player i.e. the striker, teams’ performance and hence revenue will be affected due to poor performance by other players which will lead to a reduction in net goals and less attendance by the fans due to un-involvement of their favorite team player i.e. striker.

Build a new stadium and sign new strikers:

The proposed strategy requires significant investment i.e. $20 million as a transfer fee and $125 million for upgrading the stadium along with other expenses associated with day to day activities. The strategy will ensure that maximum fans are accommodated and result in maximum revenue which is evident by NPV of $354. In addition, the strategy will ensure significant economies of scale are achieved and the quality of the team is improved. In addition, obtaining the finance will be easier as the strategy has huge growth prospects and investors would be willing to lend more funds due to the significant forecasted enterprise value of the club as compared to current value and share price of $13. However, the chairman will need to ensure that the construction activities do not affect the experience of the fans and at least two or three strikers are signed so that if one striker gets injured, the team performance will not be affected due to other skilled strikers.

Recommendation:

From financial and Qualitative perspective, it will be recommended to the chairman to upgrade the stadium and sign at least two strikers simultaneously as the NPV of the specified strategy is greater as compared to other two options and investors are likely to grant funds for the strategy considering, significant returns will be achieved due to increased dividends to shareholders. Moreover, as the football club is highly renowned and has a huge fan base, obtaining legal permission to expand stadium will be easier.

Conclusion:

The chairman of Tottenham Hotspur Plc, a leading publicly-owned football club founded in 1882 having geographical origination of England faced a dilemma regarding the selection of the most effective strategy from financial and qualitative perspectives in order to generate significant revenues in the future, maintain the club’s competitive position and ensure the sustainability for the organization.

Therefore, the strategies were evaluated using Discounted Cash flow method, NPV, and IRR, which suggested that upgrading the stadium along with signing new scorers will be feasible for the club considering, the strategy generated higher NPV, Enterprise value, and IRR as compared to other options...............................

This is just a sample partical work. Please place the order on the website to get your own originally done case solution.