The management of your company, which is based in the UK, intend to pursue a globalisation agenda. You may choose which overseas country to focus on for your report. They are unsure whether to license local companies, takeover an existing company or set up a completely new companyin your country of choice.
Your group is responsible for preparing a report explaining the inherent risks your company should consider before licensing, acquisition or Greenfield investment. Data is available on the websites listed below and you shouldidentify relevant data and produce relevant graphs and tables to include in your report.
Using the lecture notes and additional reading you must explain the relevance of the data and graphs you have included in your report and provide an overall recommendation as to whether your company should license local companies, takeover an existing company or set up a completely new companyin your country of choice
You will need to provide information concerning
• The advantages and disadvantages of licensing local companies, taking over an existing company or setting up a completely new company.
• Provide a discussion of the following and relate your discussion to each of the three strategies the company is considering:
o The countries'economic positions for example: recent inflation, changes in exchange rates
o The countries' corporate governance and corruption rankings and the likely political risk involved.
o The countries'current levels of inward foreign direct investment activity
o An example of transaction exposure using historical exchange rates, but also explain the possible effects of translation and economic exposure.
o Trends in the costs of debt for the previous year and the change in the countries' share price indices.
o Whether the countries you have chosen impose tariffs, explaining why this might be an issue for the company.
o The countries' credit ratings.