Corning Essay

8909 words - 36 pages

Do N
ot Co
py or
Po st
This document is authorized for use only by RICHARD SPURGIN until April 2011. Copying or posting is an infringement of copyright. or 617.783.7860.
5-207-030 S E P T E M B E R 2 0 , 2 0 0 6
________________________________________________________________________________________________________________ This note was prepared by Professor Malcolm Baker for the sole purpose of aiding classroom instructors in the use of "Corning: Convertible Preferred Stock," HBS No. 206-018. It provides analysis and questions that are intended to present alternative approaches to deepening students' comprehension of business issues and energizing classroom discussion. HBS cases are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management. Copyright © 2006 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-545-7685, write Harvard Business School Publishing, Boston, MA 02163, or go to No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means-electronic, mechanical, photocopying, recording, or otherwise-without the permission of Harvard Business School.
Corning: Convertible Preferred Stock
Substantive Issues
Founded in 1851, Corning Incorporated (Corning) had spent much of its history focused on the manufacture of glass products. By the late 1990s, Corning looked more like an emerging, high technology company than a 150-year-old manufacturer. The passage of the Telecommunications Act of 1996 and the growth - and anticipated future growth - of Internet traffic created considerable demand for Corning's fiber optic telecommunications products. Almost two-thirds of its sales came from this segment. Like many other telecom suppliers, Corning's stock price rose rapidly over this period, increasing 12 times between late 1998 and the fall of 2000. The rising stock price facilitated internal growth and growth by acquisition. When the demand for its products fell sharply in 2001, so did Corning's stock price, giving up all of its gains from the late 1990s and then some.
With Corning's survival in question, James Houghton returned to the post of CEO in 2002. A $5 billion charge to earnings in 2001 meant that the company was in danger of violating its debt-to- assets covenant. Moreover, cash flow turned negative in the first half of 2002. Needing a new infusion of equity capital, CFO James Flaws and Houghton were considering issuing $500 million of mandatory convertible preferred stock. The new security offered a dividend of 7% for three years, after which the security would be converted into equity at a predetermined rate. An unusual feature of the security was that the dividend was guaranteed with a dedicated...

Find Another Essay On Corning

Cracking the Glass Essay

1939 words - 8 pages There is a company known as Corning, you may or may not have heard of them but be assured they are prevalent in many fields as manufacturers of appliances with a wide ranges of uses. They have recently released information in the form of videos, articles, and Public Service Announcements in regards to a new product known as Smart-glass. They have mentioned in all their releases how the new technology will become ubiquitous in the near future


3697 words - 15 pages performed on 100,000 to 150,00 American women per year, earning roughly $500 million for surgeons and manufacturers. Major manufacturers included Dow Corning, Bristol-Myers Squibb, Baxter International, Bioplasty, Mentor Corporation, and McGhan Medical Corporation. In 1992, the FDA banned silicone breast implants. Today's implants are usually filled with salt water (referred to as "saline implants").A number of business and public policy questions

Silicone Implant History

511 words - 2 pages Silicon Breast Implants In the mid 20th century when Silicones were initially developed by Dow Corning, they were though to be completely inert - not reacting to any chemicals in the body. Silicones are very stable at high temperature, which allows them to be easily sterilized and used during surgery or as implants opening the possibility of a myriad of medical uses.During the early years, animal studies showed that a whole series of familiar

Innovative Approaches to Corporate Management

1194 words - 5 pages business, large or small, communication is the first and most important key to becoming a success.In an informative article by Kelley (2006) Owens Corning decided to re-vamp the company's communications vehicle and sought out help from the Jim Shaffer Group to assist them in implementing a standardized method for internal and external communication within the company. Together, Owens Corning and the Jim Shaffer Group created what is now called

Z Glass.

1695 words - 7 pages solution they made should accept from both M&E team and from the plant's leader.For about the Z-Glass project, I think that this project is important to the future of Corning Glass, since Z-Glass was Corning's code name for a multilayered, compression-molded glass product that was exceptionally strong and impact-resistant for its weight. Its durability and hardness, combined with its low weight and competitive cost, made it an attractive

Explain the advantages and disadvantages of a matrix structure in organisations.

1438 words - 6 pages companies, which worked on major projects, such as research and development departments, advertising agencies and enterprise consultancy.The matrix idea was originally limited to projects and, therefore, to a limited time period and purpose. In 1967, the Dow-Corning company attempted for the first time to transfer the basic idea of multi-dimensionality into a permanent organisation. Although the company could not fall back on other experiences

Managing Organisations.

1446 words - 6 pages . Project organisation quickly spread into other sectors and even entire companies, which worked on major projects, such as research and development departments, advertising agencies and enterprise consultancy.The matrix idea was originally limited to projects and, therefore, to a limited time period and purpose. In 1967, the Dow-Corning company attempted for the first time to transfer the basic idea of multi-dimensionality into a permanent

The Physicalc Description Of Dry Ice.

540 words - 2 pages bubble and "smoke" for several minutes.Cloud ChamberAn easy to make cloud chamber can be used to observe Alpha or Beta particles. Use a clear Pyrex or Corning shallow glass container that will not break in a freezer. Cover the bottom inside of the dish with black felt or black paper. Cut a piece of cardboard larger than the top of the dish. Pour alcohol on one side of the cardboard. Place the cardboard on the dish with the wet side down. Heat the top

Eileen Marie Collins

578 words - 2 pages NAME: Eileen Marie Collins (Colonel, USAF) NASA Astronaut PERSONAL DATA: Born November 19, 1956, in Elmira, New York. Married. She enjoys running, golf, hiking, camping, reading, photography, astronomy.EDUCATION: Graduated from Elmira Free Academy, Elmira, New York, in 1974; received an associate in science degree in mathematics/science from Corning Community College in 1976; a bachelor of arts degree in mathematics and economics from Syracuse

"The Role of the Media in the Public Understanding of Health Issues" Breast cancer & Silicone implants

2020 words - 8 pages mastectomies (removal of the breast) from cancer, and have been on the market since the American company "Dow Corning" introduced them in 1962 (Internet 5). "In the late 80's an animal study showed that silicone gel caused cancer in rats" (Internet 6). There has been much controversy in the United States over silicone breast implants, that The Food and Drug Administration (FDA) have withdrawn silicone implants (Internet 7). The US government studies, have

Three Takes on New Product Development

549 words - 2 pages the absence of regulatory restraints. A fifth force, the dispersion of technology in the new economy, has forced a rethinking of traditinal globalization framing exercise.Globalization can take on many forms, ranging from a centralized home-base model, like that used by Boeing, to regional bases, to regional headquarters, to integrated networks. Many companies are now developing technology at a distance from the markets, like ABB and Corning

Similar Essays

Corning Businesses Essay

731 words - 3 pages Established in 1851, Corning is a large company with offices and manufacturing plants in six continents. At the beginning of the 2001 Corning employed a global work force of over 41,000. In 2000 Corning took in sales of $7,127.1 million up 50.32% from 1999 when sales were $4,741.1 million. Since 1996 when sales were $3,328 million sales have risen 114.16 %, an average increase of 28.54% per year. However on new assets instead of spacing out the

Corning Vitro Joint Case Study

2796 words - 11 pages factors cultural difference is also one of the important issues for the success of international business. Failing doing so may lead any company to the failure of the business. NAFTA is encouraging multinational companies of US for joint venture with Mexican companies. As per the case study Corning is American company and Vitro is Mexican company. Both companies were doing very well after joint venture, in the market and as well at technological

Case Study Culture Clash In Corning And Vitro Joint Venture

1679 words - 7 pages member of the controlling family or to top executives, while middle level managers are often not asked their opinions.As a result, Corning managers who work in the joint venture were sometimes left waiting for important decisions about marketing and sales. Refers to a Corning executive: "If we were looking at a distribution decision, or a customer decision, we typically would have a group of people in a room, they would do an assessment, figure

Case Study: Dow Corning And The Silicone Breast Implant Controversy

2938 words - 12 pages Brief HistoryAn equal joint venture between Dow Chemical and Corning Glass Works in 1943 created a company to produce silicones for commercial applications. This company was called Dow Corning. In 1930 while Corning researchers were working on possible applications of silicone in glass makings they had developed several resins, fluids, and rubber compounds that could withstand the extremes of hot and cold temperatures. It was 1940 when Corning