Submitted by: Submitted by Lulaney
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Words: 1759
Pages: 8
Category: Other Topics
Date Submitted: 03/19/2014 09:47 PM
Learning Team: Virtual Organization Strategy Paper
McBride’s Finance Service (MFS) is currently a privately held company that wants to expand its operations. To expand McBride’s will explore three options; an Initial Public Offering (IPO), an acquisition, and a merger. An IPO is the first time the owners of a company give up part of that ownership to stockholders to raise capital (Amadeo, n.d.). Acquiring another company in the same industry is one company buying a similar company, and a merger is the combination of companies. McBride will measure each options strengths, weaknesses, opportunities, and threats. They will pick the option that presents the most valuable strengths and opportunities to fit the business needs.
Strengths of each approach – KARRI
The three options McBride’s Finance Service will consider have strengths that will help the company with the expansion. Going public through an IPO would give the company much needed capital and would increase the company’s net value. Acquiring another organization in the same industry would allow entry into new markets, more customers, and capitalize on the business reputation. Acquiring another organization in the same industry and merging with another organization share some of the same benefits. Merging with another organization would reduce costs, generate more customers, offer a greater range of products and services, get into new markets, and combine skills and knowledge with another company’s skills and knowledge to produce and sell more products. All three options produce and encourage growth of McBride’s Finance Service and will provide a way to earn capital, cash, and credit.
Weakness of each approach – LAUREEN
Although there are strengths to the approach of an IPO’s, acquisitions, and mergers there are weaknesses as well. Weaknesses come in the form of cost, employees, productivity, consumer perception, and loss of control. Going public through an initial public offering (IPO) could be...