The nature of electronics manufacturing and distribution in an increasingly "flat world" is one of strong competition, building business relationships and synergies, and also one of consolidation, as companies look to improve their horizontal capabilities. Increasing costs of transportation and distribution as well as global currency fluctuations particularly complicate business opportunities and threats. Valuations are further challenged by inflation and changing economies. Lester Electronics "is a consumer and master electronic master distributor, which markets its product across the Americas." (Scenario, University Of Phoenix, 2008) Bernard Lester formed an exclusive supply agreement with Shang-Wa Electronics CEO, John Lin, to sell Shang-Wa's capacitors throughout the US market. CEO John Lin is hoping to retire, and would like to see his company left in good hands; he has recently suggested he is open to growth opportunities so his company could meet the growing demand of his products. He is also hoping to close a deal with Lester on a new joint venture manufacturing facility in Europe.
Lester Electronics has an important decision to make regarding its future and needs to decide if they should acquire Shang-Wa Electronics or if they should sell the company to Avral Electronics, which is an electronic and component manufacturer based in Paris. Bernard Lester formed an exclusive supply agreement with Shang-Wa Electronics CEO, John Lin, to sell Shang-Wa's capacitors throughout the US market. John Lin has recently suggested he is open to growth opportunities and Transnational Electronics Corporation has expressed interest in acquiring Shang-Wa because they see the growth and demand for the specialty capacitors they produce. However, Lester Electronics would lose 43% ...