Introduction Hampton Machine Tool Company, a machine tool manufacturer, was founded in 1915. Hampton's customer base is made up primarily of military aircraft manufactures and automobile manufacturers in the St. Louis area. Hampton felt the boom in the 1960 with record setting profits in the mid to late 1960. Hampton slowed down in the 1970s with the withdrawal from Vietnam War and the oil embargo. Hampton stabilized by the late 1970s and now has a larger market share, as other competitors were
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On September 12, 1979, Hampton Machine Tool Company (HMTC) requested from St. Louis National Bank a renewal to their loan of $1,000,000 due to be repaid on September 30, 1979 and also to be given an additional loan of $350,000 for new equipment purchases in October 1979. Both loans were to be repaid on December 31, 1979. Hampton M.T. Company wrote a letter to the St. Louis National Bank stating the reasons for the extension of the loan and the need of the additional loan, and giving
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Executive Summary Statement of the Problem Hampton Machine Tool Company is a manufacturing company located in the St. Louis area that supplies industrial tools to manufacturers in both the automobile and military defense industries. St. Louis National Bank is considering a loan request from Hampton on September 14, 1979. The loan request consists of the renewal of a previously granted loan of $1 million, used to repurchase stock, and an additional $350 thousand, needed to upgrade machinery.
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|948 |600 |600 |600 |600 | |expences(not include interest and raw materials) |400 |400 |400 |400 |400 | |machine purchase | | | |350 | | | |tax | |181 | | |181
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site is Hampton. The main motive of the Corporation is to select a site which is competent enough, has abundant amount of resources and produce higher margin of profits. SITUATIONAL ANALYSIS In 1962 Sands Corporation won a very competitive bidding of the contract of manufacturing military aircrafts. Due to the size of the contract and the government specifications of the machines realized the corporation that, it is not possible to manufacture the parts with the company owned machine tools. This
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Problems Facing Hampton • Hampton seeks to renew its current $I million note payable by 3 months, whilst securing an additional $350,000 in loans payable in 3 months. • Some issues faced by Hampton as it seeks the new loan and renews the current loan o Monthly interest rate of 1½ % on the Principal and additional $350,000 (if secured) and ability to repay loan with these interest payment commitments o Old machinery requiring upgrade to effectively meet capacity production. o Limited free cash
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Case: Hampton Machine Tool Company Assignment Questions Why can’t a profitable firm like Hampton repay its loan on time and why does it need more bank financing? What major developments between November 1978 and August 1979 contributed to this situation? The main reason why the company cannot repay its loan is because the company bought back 75,000 of shares at a cost of $3m. ($1m from the loan, $2m of cash) The company have also poorly forecasted sales from January to August ($11.9) with actual
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Hampton Machine Tool Company (HMTC) is a machine tool manufacturing business whichstarted in 1915 and has been a stable company since its establishment. The company’srevenues rely heavily on military aircraft and automobile manufacturers within the St. Louisvicinity.During 1960’s until end of 1970’s, HMTC experienced highs and lows which were mainly due toincreases and decreases in production. This is influenced by the Vietnam war, economicconditions, expansion of export market and demise of competitors
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M A R C H 2 014 Are you ready for the resource revolution? Stefan Heck and Matt Rogers Meeting increasing global demand requires dramatically improving resource productivity. Yet technological advances mean companies have an extraordinary opportunity not only to meet that challenge but to spark the next industrial revolution as well. Most cars spend more than 95 percent of their time sitting in garages or parking lots. When in use, the average occupancy per vehicle is well below two people
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MarketLine Industry Profile Hotels & Motels in the United States October 2012 Reference Code: 0072-0520 Publication Date: October 2012 WWW.MARKETLINE.COM MARKETLINE. THIS PROFILE IS A LICENSED PRODUCT AND IS NOT TO BE PHOTOCOPIED United States - Hotels & Motels © MARKETLINE THIS PROFILE IS A LICENSED PRODUCT AND IS NOT TO BE PHOTOCOPIED 0072 - 0520 - 2011 Page | 1 EXECUTIVE SUMMARY Market value The United States hotels & motels industry grew by 7.7% in 2011 to reach a value
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