Explore the possibility of establishing a factory

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Reference no: EM131069163

Apa format for citation and refernces

At least 2 references

Axetem, Inc. wants to explore the possibility of establishing a factory and a customer service center in a developing nation to take advantage of a less expensive labor force. The first step in a series of various feasibility studies is a political risk analysis. You have been asked to put together a team to start the process.

Compose a memo to your team that includes the following:

To what does the term political risk refer?
Give at least 3 examples of sources of political risk.
Explain what distributive and catastrophic political risks entail, and explain which type is more likely to be a more significant factor in a developing country.

Assignment objectives:

Discuss implications of international politics for strategic financial management.
Analyze ethical issues in financial management for multinational enterprises.

Thanks

Part b: 2 or more pages

Research the following: Francois Buisson is the controlling shareholder of Groupe Industrielle Internationale (GII), a major importer of sporting goods in the European Union. GII is aiming for a major expansion project within the next 5 years. One of the objectives of this expansion is to form a major alliance with Axetem as its main running shoe supplier. In short, GII's expansion plans will entail huge sales revenues for Axetem. To gain additional investors, GII wants to list its company's stock on the NYSE.

Brian Tobias, Axetem's CEO, has mandated the creation of a special team at Axetem, Inc. with the aim of helping GII get started on its task of getting listed on the NYSE. Your team is to conduct initial research about the requirements for a non-U.S. firm to obtain an NYSE listing and how a non-U.S. firm can maintain its NYSE listing.

Hint: Start by visiting https://www.nyse.com/, and look for various listing requirements.

research the top listing and continuation requirements mandated by the NYSE.

Complete the following for paper

Currently, GII's capital structure is 75% equity based and 25% debt based. GII is in the 25% marginal tax bracket in France and has a cost of equity of 18% and an average debt cost of 7%. Calculate GII's weighted average cost of capital (WACC).
What is the main advantage of the divisional cost of capital approach over the WACC approach?

Use the available resources to research the NYSE and the divisional cost of capital approach to complete this assignment.

Part c: 6 paragraph

· Why do the top listing and continuation requirements of the NYSE exist?

· How do these requirements affect the capital structure of a multinational firm?

· What elements make up the optimal capital structure for a multinational enterprise Three dfferent sections

Reference no: EM131069163

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