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By Sven A. Wehrwein

Leveraged buyouts are a fixture in today's market place. This paper will include comments on how LBO's are analyzed, structured and sold, as well as an overview on the present environment of LBO's.

Jan 1, 1990

By John R. Caldon

INTRODUCTION Leasing has become a major industry in many countries because of the advantages it affords. Whilst the accounting, legal and tax treatment of leasing varies from country to country, there is far more similarity than difference. The general approach to the subject is largely the same. This paper looks to the basic financial considerations in the decision to lease or buy. TYPES OF LEASES Before embarking upon the subject, it would seem appropriate to define a "lease". A lease may be defined as: "an agreement granting one party the right to use, for a specified period of time, property owned by another party in return for a series of payments of rental by the user to the owner''. Ownership, of course, generally entitles the owner to unrestricted use of the asset over its useful life in contrast to a lease which gives the lessee use over a limited period. The distinction between the status of owner and a lessee often is fairly small. In this case we are dealing with what is generally termed a "finance lease". A finance lease is one which substantially transfers the risks and benefits of ownership from the legal owner to the lessee. For example, a finance lease would exist where the lessee enters into a lease of an asset for most of its useful life and has an option to buy the asset at the end of the lease for a price which takes cognisance of the rentals already paid. Where a lease does not substantially transfer the benefits and risks of ownership to the lessee, i.e. those benefits and risks remain with the owner and lessor, the lease is termed an "operating lease" and is an agreement for the renting and usage by the lessee of an asset owned by the lessor for a limited period. An example of an operating lease might be where a tenant leases a building for a defined period say 6 years with the rent and occupancy subject to renegotiation at the end of the lease term. The economic consequences of the distinction between a finance and an operating lease is very important. With a finance lease, the lessee has a de facto economic interest in the asset and the alternative to a finance lease is some form of purchase; with an operating lease, the lessee does not have a basic economic interest in the asset and consequently a comparison with a purchase option involves far more than simply a funding comparison. Some of the principal differences between finance and operating leases can be summarised as follows: (a) finance leases: -the risks and benefits of ownership are substantially transferred to the lessee; -the lessor normally recovers his investment during the term of the lease; -the lessor in entering into the transaction is relying more on the creditworthiness of the lessee than the underlying value of the asset; - the lease is either non-cancellable or a large penalty will apply for unilateral cancellation by the lessee; (b) operating leases -the risks and benefits of ownership remain essentially with the lessor; -the lease rental income would not normally cover the recovery of the lessor's investment; -the lessor evaluates his risk in terms of the underlying value of the assets;

Jan 1, 1985

By Donald W. Gentry

Many firms in the minerals industry are facing enormous capital-equipment requirements for existing operations, planned expansion programs, pollution control systems, etc. Yet, because of existing economic conditions, mining companies find it increasingly difficult to obtain reasonable financing for the acquisition of large, high-cost capital equipment. One way of obtaining the use of mining and other major pieces of high-cost capital equipment is through leasing. The popularity of this approach is evidenced by the growing number of leasing companies, equipment manufacturers, and financial institutions now offering this service to their customers. Indeed, leasing has become a billion-dollar industry, and many commercial banks have developed sizeable portfolios in this area. "Should we buy or lease?" This question eventually comes up whenever a mining company needs additional major capital assets. Unfortunately, many buy-or-lease decisions are made on an emotional basis-rather than on a proper financial evaluation that would yield the…

Jan 9, 1975

By Blandford C. Burgess

Mica is an orchid among minerals. It is formed in pegmatites, one of the most bizarre of igneous formations, and is exceeded by few other minerals in the perfection it may attain as to size, color, and cleavage. First used for window glazing, as an ornament and article of trade, it has become one of the most essential insulators of electricity, heat, and shock. Most internal combustion engines use mica condensers or capacitors and such machines of war as planes, tanks, and submarines are immobile without it. The original manuscript of this guide was written in April 1943 at the peak of war emergency. It was not used be- cause shortly thereafter a decision was made to buy on a one price basis eliminating differentials for both quality and size. This is now presented with the thought that from the standpoint of preparedness we can only consider an- other war imminent and every effort should he made to set up in usable form the experience gained during the Second World War. Colonial Mica Corp. was set up by Metals Reserve Co. as a wholly owned government agency to encourage production of domestic mica and to purchase it. It soon became the exclusive buying agency for such mica. The writer as Southern Manager called on all the private agencies buying mica to assist in formulating buying policies, methods, and prices.

Jan 1, 1949

By Blandford C. Burgess

Mica is an orchid among minerals. It is formed in pegmatites, one of the most bizarre of igneous formations, and is exceeded by few other minerals in the perfection it may attain as to size, color, and cleavage. First used for window glazing, as an ornament and article of trade, it has become one of the most essential insulators of electricity, heat, and shock. Most internal combustion engines use mica condensers or capacitors and such machines of war as planes, tanks, and submarines are immobile without it. The original manuscript of this guide was written in April 1943 at the peak of war emergency. It was not used because shortly thereafter a decision was made to buy on a one price basis eliminating differentials for both quality and size. This is now presented with the thought that from the standpoint of preparedness we can only consider another war imminent and every effort should be made to set up in usable form the experience gained during the Second Morld War. Colonial Mica Corp. was set up by Metals Reserve Co. as a wholly owned government agency to encourage production of domestic mica and to purchase it. It soon became the exclusive buyimg agency for such mica. The writer as Southern Manager called on all the private agencies buying mica to assist in formulating buying policies, methods, and prices. A meeting was held for that purpose in Asheville, N. C., July 20, 1942. In the general discussion the first two hours of the meeting it was decided that the following factors should be considered in pricing strategic mica: clearness, flatness, trimming, color, classification (size and quality), free splitting, hardness, and air inclusions. Most of the mica miners have been buying strategic mica, according to the mine, as No. 1, No. 2, or Nos. 1 and 2 combined. In addition to these grades of strategic mica they have been buying three lower grades of mica, electric (vegetable-stained), black-spotted and black-stained. A number of mines were named one by one and the buyers present gave their opinions as to the basis they would use in buying the sheet mica from each. It was suggested that in addition to the prices already published, prices be posted up to 10 pct higher for special quality and preparation and prices be posted 25 pct lower than the published prices for the lowest acceptable grades of strategic mica, giving the buyers authority to make intermediate prices according to the quality and preparation. It was thought desirable at the same time to announce prices for nonstra-tegic mica where such quality is being obtained in mines producing strategic mica and where it would be necessary to take the output in order to get the strategic mica. It was also suggested that the price of electric and black-spotted mica be 50 pct below the price of the lowest grade of strategic mica and the price of black-stained mica be 60 pct below the price of lowest grade strategic mica. The few experienced buyers available were employed but they were inadequate for the job and others had to be trained. All needed a guide or primer of some kind to attain systematic procedure and consistent prices in their respective buying areas. The Mica Buyers Guide was formulated for that purpose based on experience gained in the first six months of buying. The Preface to the original guide was as follows: The purpose of this guide is to serve as a text in training beginners and as a handbook for experienced buyers of the instructions which have been issued up to this time. At the meeting of prospective buyers last summer, it developed that the first essential to attain uniformity must be some kind of check sheet. Our "Mica Buyers Report" was developed for this purpose and forms the backbone of this guide. Price is determined according to size, quality and preparation. Size can be measured, but no system of measurement or machine has been devised which can be substituted for the trained eye of the buyer to deterrnine quality and preparation. Although the "One Price" system was instituted and the "Guide" not used, the buyers were required to continue making out a "Mica Buyers Report" (Fig1) with each lot of mica purchased. The form proved its value and there is no doubt that in another such emergency some similar form should be

Jan 1, 1950

R. Dawson Hall, who has long been a member of the editorial staff of Coal Age, has been appointed managing editor. Increase the Promise of the future. Buy W. S. S.

Jan 7, 1919

By AIME AIME

EDWIN W. KEMMERER, professor of international finance at Princeton, in a speech before a banking conference at Urbana, Ill., on Nov. 26, stated that the increase in the store of gold held by the United States is not so alarming as it appears on the surface. Excerpts from his address, as reported by The New York Times, follow: "It is significant . . . that the value of gold as expressed in its purchasing power in the United States during the last half-dozen years has been higher than at any other equivalent period since our records began 140 years ago. Our so-called 59-cent dollar today buys about 25 per cent more goods at wholesale than did our old dollar in the prosperous year 1926, and an ounce of gold will now buy considerably more than twice what it did then. This present high value of gold is one reason for its recent large production.

Jan 1, 1941

Advantages to Members of Our Advertising Section.-It is our intention to make the advertising section of the Bulletin as comprehensive as possible, so that members can turn to it for complete information as to where to buy the best mining and metallurgical supplies at the lowest prices. No firms or supplies of dubious reputation are advertised in the Bulletin. If members, in buying any material, will refer to the advertisement of that material in the Bulletin, or if they do not find it advertised in the Bulletin, will, when ordering, ask the manufacturers why the goods were not advertised in the Institute publication, it will be of material benefit to all of us, because the chief reason why advertisers are unable to trace direct results is because purchasers do not mention the Bulletin when writing. Finally, if members, when in need of anything whatsoever, will write to the Institute headquarters, an effort will be made to send them a complete list of manufacturers able to supply the desired materials of good quality. The furnishing of these lists will be a benefit to our Advertising Department, as well as to the members. We need scarcely call attention to the advantages obtained by the members from the money which advertising brings in, because all this money is returned directly to the members in one form or another.

Jan 7, 1913

Advantages to Members of Our Advertising Section.-It is our intention to make the advertising section of the Bulletin as comprehensive as possible, so that members can turn to it for complete information as to where to buy the best mining and metallurgical supplies at the lowest prices. No firms or supplies of dubious reputation are advertised in the Bulletin.. If members, in buying any material, will refer to the advertisement of that material in the Bulletin, or if they do not find it advertised in the Bulletin, will, when ordering, ask the manufacturers why the goods were not advertised in the Institute publication, it will be of material benefit to all of us, because the chief reason why advertisers .are unable to trace direct results is because purchasers do not mention the Bulletin when writing. Finally, if members, when in need of anything whatsoever, will write to the Institute headquarters, an effort will be made to send them a complete list of manufacturers able to supply the desired materials of good quality. The furnishing of these lists will be a benefit to our Advertising Department, as well as to the members. We need .scarcely call attention to the advantages obtained by the members from the motley which advertising brings in, because all this money is returned directly to the members in one form or another.

Jan 7, 1913

FEB. 17-The past month found the average citizen backed off just a little more into his blind corner staring glassily at hydrogen bombs, unbalanced budgets, John L. Lewis, more inflation, a rising wave of strikes, the country's only active battleship on a mudbank, a famous scientist in gaol as a traitor, a favorite actress on a Roman holiday, and rising mountains of potatoes, butter and eggs begging for destruction. About the only bright spot has been industrial activity and employment, but even these are menaced by the coal shortage. Most industries have orders on hand or in prospect to warrant high operations for some time to come. The trend of the Reserve Board's production index is upward except as strikes may interfere. There has been heavy buying at the seasonal merchandise shows, particularly in furniture and house-hold goods. The demand for goods of this kind illustrates greater confidence in the Spring outlook than was generally felt a year ago. Further, the demand also reflects improved market positions due to curtailment of output and reduction of inventories in 1949 and sustained consumer buying power. It demonstrates the strong support that is given directly to many businesses, and indirectly to all, by the phenomenal construction activity that is now under way. The Commerce Department places the number of new dwelling units started in 1949 at the new all-time high of 1,019,000.

Jan 3, 1950

By F. S. Peabody

ANYTHING that may be said about "too much coal" must seem rather incongruous just at this time when two-thirds of the mines in the United States have been idle for nearly four months and a temporary coal shortage looms as more and more of a possibility. It is the purpose of this article, however, to deal primarily with the fundamental ills of the bituminous-coal industry, which, when summed up, can be expressed in one word-overdevelopment. During recent years the bituminous-coal industry in the United States has been seldom, almost never, in a state of normal business health with production run-ning evenly, prices steady and the market absorbing the output from week to week. There has been either a condition of feverish activity or apathetic sluggish-ness. We have had, for example, the intense strain on production during the war years with heatless days and lightless nights, followed by the slump late in 1918 which lasted through the greater part of 1919 when coal was a drug on the market. Then came the panicky demand of 1920. Competitive buying forced prices up to the highest levels in history. This demand in turn fell off suddenly in November, 1920, and the market remained apparently paralyzed all through 1921. During the latter year, lack of buying forced intermit-tent suspension of mining in all fields and prices averaged less than actual cost of production.

Jan 8, 1922

By H. A. Guess

For a number of years I have used for the commercial wet assay of lead generally the ammonium molydate, and occa-sionally the ferrocyanide method. These well-known methods need no detailed description here. In the ore-selling and ore-buying establiahments of the West, 90 per cent. of all wet lead-assays are made by one or the other, and at least nine-tenths of this proportion by the molybdate method. A procedure so well-established must have merit; and, in

Jan 1, 1905

By W. V. Bluck, W. L. McMorris

Higher coal quality is being recognized in potentially lowering the cost of power as measured at the bus bar. Assessment of potential coal supplies for most power plants is now going beyond buying at the lowest delivered fuel cost. It is now taking into consideration other factors, such as handling, storage, pulverization cost, boiler fouling, post combustion cleanup, and waste disposal costs. New measurements of quality are being considered now by those producing and those consuming the fuel by assessing numerous variables in the total fuel cycle to achieve the lowest possible power costs.

Jan 1, 1986

The University of Idaho Mining Society held a meeting on Oct. 23, and elected the following officers: President, Sam Bloom; Vice-President, Lloyd McDougall; Secty Treas, Jess W. Wade. Regular meetings are held on the first and third .Tuesdays of each month, for informal lectures and reports on technical subjects. The Mining Club of the University of Wisconsin has held four recent meetings On Oct. 17, sixteen new members were inducted, and a committee was appointed to buy a Liberty Bond. The second meeting, Oct. 31, was devoted to general entertainment, at the home of Professor McCaffery.

Jan 1, 1918

An ore search for commercial titanium-bearing ore deposits is in progress by the Crane Co., manufacturers of valves, because they expect this metal to be important in valve manufacturing in the future. The company will eventually be mining and making titanium sponge. At present they are buying titanium tetrachloride from the Stauffer Chemical Co, at Niagara Falls and making titanium by reaction with magnesium. Production from the Babbitt concentrator of Reserve Mining Co. is scheduled to begin in late 1951 or early 1952. The capacity is to be 300,000 tons of pellets per year made from magnetic taconite concentrates.

Jan 7, 1951

By Jean Herenguel

THE published work of Lacombe and Beaujard' has demonstrated the interesting application of etch figures to the determination of crystal orientations in aluminum by a purely micrographic method. The geometry of these figures leaves no ambiguity and the method has the added advantage of being applicable to very small crystal units. These authors applied the technique to the study of high purity aluminum, and it has now been adopted buy Heren-guel and his collaborators to various researches on commercial aluminum, containing up to 1 pct Fe and Si. This must modify the opinion point,ed out by

Jan 1, 1953

By C. L. Clark

EVERY user of steel should ask himself whether or not he is taking full advantage of the discoveries of the steel metallurgists during the last few years, or is merely buying grades that looked to be the best five or ten years ago for various specific purposes and have since proved perfectly satisfactory in his plant. If he has not kept abreast of the times, then it is probable that something better has been developed, or something just as good that costs less. Though this article will have to do with steel for high-temperature applications primarily, marked advances have been made in steels for other purposes as well.

Jan 1, 1940

By John Dasher

Getting spodumene to float quickly and cleanly can be a problem. The author has presented an excellent account of a valid and useful approach to the scale-up of such problem floats. This indicated advantages for doubling retention time, i.e., buying another set of flotation cells. The author states that 21 pct of the spodumene floated in 2 min in the laboratory cell, that the grade of the rougher was about 75 pct spodumene, and that the final tailing contained 4 to 12 pct spodumene in different sizes with the present cells and 1 to 9 pct spodumene with twice as many cells.

Jan 6, 1959

By D. W. Jessup

THE handling of native labor is offering an interesting problem that requires diplomacy. It is difficult to induce many of the men to leave their villages and enter into regular work. They do not feel the necessity of manual labor other than to obtain sufficient money to pay the annual hut tax and to buy a little clothing. The ground provides mealies (corn) which means food and beer, he hunts and catches fish, so why work? But gradually, as the native becomes more civilized, his wants increase and his ideas change; he now needs money to supply his desires and eventually he must work more. So in time it is hoped that the labor market will be better supplied.

Jan 1, 1931

By John V. Beall

The mining industry of Japan is not very large, but it is very old. Some of the mines have 1000 years of history. At Nara, the capitol 1300 years ago, the great Buddha of bronze that was cast at that time was of metal mined from several localities in Japan including the Akenobe-Ikuno district, one of the present Mitsubishi properties. Methods of smelting copper and iron, it is believed, came from China via Korea. A characteristic of the Japanese mining industry today is one of buying abroad and treating at home, a variety of ores of different compositions. All in all, Japan's mineral deposits under its own flag are inadequate for its great industrial strengths.

Jan 5, 1969