Strategic Management and Finance Research Paper

Strategic Management and Finance - Research Paper Example 1,670,000 Net cash flow per year 690,000610,0001,350,0001,505,0001,670,000 Net Present Value: Present Cash Flows PV Factors Value Year 1 690,000 0.8929616,071 Year 2 610,000 0.7972486,288 Year 3 1,350,000 0.7118960,903 Year 4 1,505,000 0.6355956,455 Year 5 1,670,000 0.5674947,603 Salvage return 700,000 0.5674397,199 Total 4,364,519 Investment (10,000,000) Net Present Value (5,635,481) Payback Period: Net Remaining Cash Flow Investment Payback period is Longer than the project life of 5 years Investment 10,000,000 Year 1690,0009,310,000 Year 2 610,0008,700,000 Year 3 1,350,0007,350,000 Year 4 1,505,0005,845,000 Year 5 2,370,0003,475,000 Scheme 2 Net Cash Flow per Year Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Expected annual cash receipts from sales2,600,0002,800,0003,000,0003,200,0003,500,0003,500,000 Expected annual costs of new product Cash expenses 1,550,0001,620,0001,720,0001,810,0001,930,0002,060,000Depreciation expense 583,333583,333583,333583,333583,333583,333 Net income 466,667596,667696,667806,667986,667856,667 Net cash flow per year 466,667...The reduction in the inventory turnover resulted from the significant increase in the stocks. This increase might be a result of the company's hedging for foreseen price increases. The Board should accept Scheme 2. Based on NPV, it has a much lower negative NPV than Scheme 1. Moreover, it has a shorter payback period than Scheme 2, which according to the above calculations will never be able to pay back the company's 10,000,000 investment. PT Trada Maritimes debuted in the Indonesia Stock Exchange on September 2, 2008 (Trada Maritime 2008). Right after its debut, the stock price reached as high as 27 per cent of its IPO price. The company went public as a result of its additional capital requirements on its expansion plan for 2009. Trada Maritimes plans to spend as much as $315 million to purchase additional vessels over the next five years (Trada Maritime 2008). Globus Maritime Limited received the International IPO of the Year on February 1, 2008 at the Quoted Company Awards (Reuters 2008). Globus was first listed in the London Stock Exchange under its AIM index in June 2007 at an IPO price of 300 pence (www.timagenislaw.com; www.investegate.co.uk). Right after its debut, the price of the company's stock skyrocketed as show in the graph below. Reuters 2008, 'Globus Maritime Limited Receives the 'International IPO of the Year' at the Quoted', Reuters, [Online] Retr

Renanlt Nissan the making of Global Alliance case Essay

Renanlt Nissan the making of Global Alliance case - Essay Example major changes were taking within the global automotive market characterized by large-scale mergers between some of the major automotive companies in the world. In addition, the economic slowdown being experienced in the Asian region was also affecting the industry, with many of the Asian automotive manufacturers experiencing financial problems. Conversely, the earlier attempted merger between the company and the Swedish carmaker Volvo in 1993 was unsuccessful and had left a negative effect on the company. This merger had been a well-planned initiative that was based on shared synergies between Renault and Volvo and comprised a significant part of the European industrial policy (Krcmar & Klein, 2006). The merger negotiations had lasted for three years and had involved various key authorities, including the French industrial minister, as the French government was a major stakeholder in the company. It was therefore important for the company to be able to undertake a successful merger undertaking in order to go past the effects of the previous failed merger. A major strength involved the company’s privatization 1996 due to the various changes in the country that resulted in the separation of economic and political factors and influences. This privatization process resulted in the French government owning only 46% of the company’s shareholding (Krcmar & Klein, 2006). As such, the management was quite sure that the company’s shareholders would approve the company’s need to expand as well as provide the management with a conducive environment to implement the company’s strategy. Another major strength of the company was its experience and market share, as the company was a major automotive producer within the western European and South America automotive markets and had a 5% of the total global automotive market. The company had excelled in the field of mid-range cars and light commercial vehicles. It was also ahead in cost reduction, efficient purchasing and