significant amount of cash for the investors, the third one is an IPO (initial public offering) has become a reality, and the last one is most realistic opportunity is sale of the business. Advantages of Family Controlled Firms are: Long-term orientation, Greater independence of action, Family culture as a source of pride, Greater resilience in hard times, Less bureaucratic and impersonal, Financial benefits, and Knowing the business. Disadvantages of Family Controlled Firms include: Less access to capital
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Intro. to Debt Policy & Value* No Questions, but review M & M Theory on debt and value of the firm. VIII. HBS Case- “Leveraged Betas and the Cost of Equity No Questions IX. C16- The Boeing 7E 7* 5 X. C26- Jet Blue Airways, IPO Valuation* 6 XI.a C35- Merton Electronics 7 XI.b C36- Carefour S. A.* 8 XI.c C44- Palamon Capital Partners* 9 XII. GM Dividend Policy Negotiation (Information to be provided by Dr. Kiss) * Note: Excel Spreadsheets
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Debt Versus Equity Financing Debt versus Equity Financing is an interesting subject in that it is one of the most important decisions a company will face when choosing to finance a new project. Debt Financing is a more traditional approach. In Debt Financing a company seeks financing from a financial institution or a private debt through a group of investors in the form of a loan. The loan will have set terms such as interest, repayment schedule, and payment amounts. The company will be obligated
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Consolidated Statement of Stockholder’s Equity 3.7 Dividend Policy Chapter IV Facebook Initial Public Offerings(IPOs) 4.1 IPOs Advantage 4.2 Preparing to go to Public 4.3 Facebook IPOs 4.4 Facebook IPOs Underwriting Company 4.5 Facebook IPOs Counsel Company 4.6 Facebook IPOs Financial Auditor 4.7 Why Facebook go to Public? 4.8 U.S. Stock Market 4.9 Which Market Facebook Plan to Listing? 4.10 Facebook IPOs Advantage and Opportunities Chapter V Conclusion Reference 1 2 3 3 3 4 5 7 7 8 9 10 10 12 14 15
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exchange, a company must go through an initial public offering (IPO) ，which is the first sale of stock by the company to the public. Private listed companies or small firms that are planning to expand the growth of their company often use an IPO as a way to generate and raise the capital needed for their company expansion. Although further expansion is beneficial to the company and its shareholders, there are both advantages and disadvantages that will arise when a company is listed on a stock exchange
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|University of Sunderland | |Managing Financial Resources andDecisions | | | |
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Yahoo! 1995 Would you invest in Yahoo! at this point? If you were Yahoo!’s management team, which financing option would you take? I would definitely invest in Yahoo! at that point. I would choose Sequoia Capital. What makes Yahoo! a true opportunity and not just a good idea? What is the vision and value of Yahoo!? At that time, the use of Internet increased rapidly and it was estimated that by 2000, 40% of homes and 70% of all businesses in the U.S. would have access to the Internet. The
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company): 1. Beyond the public offering there are no fixed charges. 2. There is not fixed maturity. 3. Common stock increases the credit worthiness of a firm. 4. Common stock can at times be sold more easily than debt. Issuer Disadvantages (the company): 1. Extends voting rights or control to additional stockholders 2. Gives more owners the right to share income. 3. Initial costs of “underwriting” and distribution are higher than bonds. 4. Changes the debt/equity
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Prohibited from active management role Real estate agents, doctors, lawyers, accountants In a corporation which group has ultimate responsibility for protecting and managing stockholders interests? The board of directors What are the disadvantages of a corporation Double taxation of dividends Subchapter S corporation can circumvent this (only up to 35 stockholders) Complex management requirements Costly reporting and structural requirements What is the issue for agency theory? Why
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easily formed, it is not taxed at corporate level and it has few government regulations. its disadvantage is that it is difficult to obtain large sum of capital, owner has unlimited debts and the business life is limited to the life of the owner. ii partnership is when two or more people own the business equally. its advantages are its low cost of business are easy to form. its disadvantages are similar to sole proprietorship ,limited life, unlimited liability and difficult to transfer
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