Aes Case Solution

This case is about Business

An analysis of AES Company case has actually been carried out, which includes evaluations of thecase, examining AES ¶ s basic WACC, assessing Venerus ¶ s changed WACC, and determiningif Venerus ought to provide his realigned WACC to the board and utilize the Venerus ¶ s adjustedWACC.AES brought Rob Venerus in June 2003 to direct the recently developed Corporate Analysis & Planning. A mix of aspects consisting of the decline of essential South American currencies, unfavorable modifications in energy regulative environments, and decreases in energy product pricesconspired to deteriorate capital at AES subsidiaries and impede the business ¶ s capability to servicesubsidiary and parent-level financial obligation. As revenues and money circulation to the moms and dad began todeteriorate, AES stock collapsed and its market capitalization fell almost 95% from $28 billion inDecember 2000 to 1.6 billion simply 2 years later on. Venerus examined the business ¶ s existingassets, which needed producing a brand-new technique of computing the expense of capital for AES business.In 2002, AES was arranged around 4 different industries: Contract Generation, Competitive Supply, Large Utilities, and Growth Distribution.

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