Cara Operations: Purchase of St-Hubert and Value Creation

Description

Cara Operations: Purchase of St-Hubert and Value Creation: Abstract

Cara Operations: Purchase of St-Hubert and Value Creation is a case study by Alpha Daye Diallo, Russell Fralich and Andrew Papadopoulos.

In March 2016, Ontario-based Cara Operations, a company that operates several restaurant chains, including Swiss Chalet (present throughout Canada, except in Quebec) – acquired Groupe St-Hubert, one of Quebec’s largest restaurant chains. With the acquisition of St-Hubert, Cara became the proud owner not only of its restaurants but also of its manufacturing plants and distribution centres. The purchase of Quebec’s iconic rotisserie chicken chain thus opened many doors for Cara.

The case describes the situation immediately following the acquisition, when CEO Bill Gregson is wondering how to optimize its impact on his company. It ends with the five options that Gregson plans to present to his board of directors:

• Allow St-Hubert to operate as an independent division at the national level
• Use St-Hubert to introduce Cara-branded products to Quebec
• Have Cara and St-Hubert combine locations
• Adopt St-Hubert’s procurement process for Cara brands
• Simply cut costs by implementing Cara’s best practices and know-how

Teaching Objectives

• Understand the integration issues faced by a company after an acquisition
• Understand the limited growth options in an industry that has reached maturity
• Discuss various growth options available to companies

Main themes covered

• Strategic decision-making during an acquisition
• Strategic capacity analysis
• Competitive analysis
• Industry lifecycle

Concepts & theories related to the case

• PESTEL analysis
• Porter’s five forces
• Industry lifecycle
• Key industry success factors
• Strengths and weaknesses

Additional information

Also available in French.

Teaching notes are available for teachers only. Contact the HEC Montréal Case Centre for more information.