MAT - Mattel - toysRthem Message Board

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Non-Tech : MAT - Mattel - toysRthem

MAT 19.88

-0.8%

11:15 AM EST

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To: Zakrosian who wrote (329)	11/12/1999 1:28:00 AM
From: Mark Marcellus	Read Replies (1) of 706

My memory is a bit hazy, but I think Quaker got Snapple at a significant discount from its high stock price, though obviously far higher than its intrinsic value. They also found out after the purchase that they were saddled with some disadvantageous bottling and distribution agreements that they were unable to break (or something like that) - issues that should have been uncovered during their DD. The business details were quite different. Whether Snapple's decline was inevitable will never be known, because Quaker's marketing people destroyed the brand before we ever had a chance to find out. Snapple had grown through word of mouth, and through the tremendous loyalty of their distributors and (mostly small) retailers. Quaker didn't have a clue on how to deal with this channel, and their normal distribution channels didn't know how to sell the product and were not at all interested in learning. Unlike TLC, there were no ticking time bombs that I'm aware of in Snapple's books, it was more of a culture clash. What the two deals have in common is that both Mattel and Quaker were desperate to make a deal. Nothing good ever comes of that.

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