Divestiture of a swedish subsidiary


Response to the following problem:

Provo, Inc. (based in Utah), has been considering the divestiture of a Swedish subsidiary that produces ski equipment and sells it locally. A Swedish firm has already offered to acquire this Swedish subsidiary.

Assume that the U.S. parent has just revised its projections of the Swedish krona's value downward. Will the proposed divestiture now seem more or less feasible than it did before? Explain.

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Financial Management: Divestiture of a swedish subsidiary
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