valuationshowsitat 718 billionbut 518 billionwill
be paid out as dividends.)Withthesechanges,thevalueofequitypershareincreasesto
14,107yen,anincreaseofabout18.5%fromthestatusquo
value of 12,115 yen. (SeeFigure 13.6.)
FIGURE 13.6Nintendo: Restructured
Probability of Changing Management
Whilethevalueofchangingmanagementinabadlymanaged
firmcanbesubstantial,theincreased valuewillbe created
only if management policies are changed. Although this
change can sometimes be accomplished by convincing
existing managers to modify their ways, all too often it
requiresreplacingthemanagersthemselves.Ifthelikelihood
ofmanagementchangehappeningislow,theexpectedvalue