Question

In: Finance

Explain the question in each method Q: Many businesses are struggling in the midst of the...

Explain the question in each method

Q: Many businesses are struggling in the midst of the pandemic, and face termination or filing for bankruptcy. Can you imagine a scenario, based on the information above, that could be used to save and/or grow a business through any of the methods taking into consideration the view of the present financial situation

Which method will be best in this pandemic situation?

Methods

• Merger with another business

• A consolidation with another business

• Assets purchase of another business

• Control and purchare intrest in an another business

Solutions

Expert Solution

I will independently examine in each of the method in this pandemic -

1. Merger with another business-merging with another business in this pandemic would help the businesses to survive and sustain, because they will have a larger pool of Assets and a larger market to Cater to.

2. Consolidation with another business will help in amalgamation of two business and consolidation of their books of account in order to have a larger pool of assets so that it will help them to survive and sustain through the pen damak.

3. Assets purchase of another business is not a good strategy is at this troubling times because the company will have to deploy a lot of its cash in acquiring of assets, which will generally do not have realisation at this point of time because the market is losing the liquidity.

4. Control and purchase interest in another business will help to acquire another business and it is another strategy which is involved in deployment a large amount of stock so this can be adopted if the company is looking through a highly lucrative investment opportunity and the cash is high in its books of accounts.

Out of all these four methods,I will adopt merging with another business because it will help in providing a larger pool of asset a higher possibility of surviving and sustaining through this troubling times and pandemic.


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