Arundel Partners The Sequal Project Case Solution

Arundel Partners The Sequal Project Case Solution

A group of investors is contemplating the purchase of sequel rights for a selection of feature movies. They need to decide the amount to propose for the purchase and how to design a contract which involves one or more of the primary film studios in the US. The case uses cash flow approximations for all of the primary films which were launched in the US during the year 1989. The information is used to comeup with an approximated worth for the sequel rights before the film’s launch. The case is structured in a way to allow the students to understand the real options and ways of valuing them. It clearly demonstrates the significance of option pricing methods for some capital budgeting issues. Also demonstrates the pragmatic restrictions of such methods.