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Gentry Inc. is a mid-sized tech firm (200 employees and $300 million in revenue) and has been privately held since the firm's inception ten years ago. The organization's board of directors is keen on expanding the operations globally to take advantage of a growing market.

Based on reports from the research and development team, the organization can increase its profitability metrics by 15 to 25% if it expands the operations to China, Japan, and Germany. Becoming a multinational organization will not be easy. To finance this expansion, the board of directors has decided to take the organization public and issue some bonds to raise an additional $50 million.

The research team has already determined that the organization meets the financial requirements outlined by the Securities Exchange Commission. The goal is to maximize the Initial Public Offering (IPO), and the leadership must efficiently manage the capital, measure the risk of the investments, and ensure the financial metrics are robust relative to similarly sized organizations.

Based on the concepts that you learned this week from the assigned videos and articles surrounding growth strategies for companies, make an initial assessment of whether Gentry should expand into China, Japan, and Germany all at one time or in a phased approach.

Module 2: In your assignment, recall the strategies that you discussed in this module's discussion questions about the different types of financial investments companies use for growth. Include the advantages and disadvantages of expanding with debt and equity (using the information that you learned in this module's materials).

Module 3: Based on the information that you learned about capital structure and budgeting, determine what the optimal capital structure should be for Gentry.

You will need to determine how much equity (common stock) the company will offer in the IPO and how much debt the company should assume in their global expansion to meet the goal of $50 million.Determine what capital structure will work best with your initial assessment.

Describe the structure using the ratios.Include the dollar amount of equity (common stock) the company should issue in the IPO and how much debt the company should use for this expansion to reach the $50 million goal. Explain your rationale.

Module 4: Based on the information that you learned about the different types of risk, scenario, and sensitivity analysis, you will be identifying the risks that will be associated with the IPO and global expansion. Using your readings from this module:Determine how each of the following risk exposures affects the international expansion of Gentry: transaction risk, translation risk, economic risk. Include how you would use sensitivity and scenario analysis to make your recommendation. Spell out the advantages and disadvantages of each method.

Using the information that you have compiled over the past four modules, prepare your summary recommendation for Gentry Inc. and its plan to expand internationally. Remember that the company is trying to raise $50 million to expand via an IPO and debt issuance.

Create a 10-15 slide presentation detailing your findings. Your recommendation should be 1-2 slides. Note that the title slide and reference slides are not included in the 10-15 total. Be sure to include academic references in your presentation as well as any charts or graphs to convey your financial information.

Include a summary the deliverables from Modules 02-04 in the presentation.

Your slides should flow as a cohesive presentation, not a patchwork of distinct pieces of information.

Operation Management, Management Studies

  • Category:- Operation Management
  • Reference No.:- M92858610

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