Question: Why would one company acquire the debt of an affiliated company? What circumstances would need to exist, economically and otherwise, to make this a sound business decision?
Discuss the motivations a company has to acquire the debt of one of its affiliates. Does the motivation differ in the situation in which the consolidated entity would report a loss on the constructive retirement instead of a gain?
Distinguish and explain the differences between business and financial risk and provide an example from a publicly traded company. Use specific examples and citations to support your assertion for business or financial risk.