[재무관리] Blades, Inc 사례(영문)

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[재무관리] Blades, Inc 사례(영문)에 대한 자료입니다.
목차
1. Effect of Exchange rate movement

2. Construct a spreadsheet to determine the annual effective financing percentage cost of the yen-denominated notes issued in each of the three scenarios for the future value of the yen. What is the probability that the financing cost of issuing yen-denominated notes is higher than the cost of issuing baht-denominated notes?

3. Using a spreadsheet, determine the expected annual effective financing percentage cost of issuing yen-denominated notes. How does this expected financing cost compare with the expected financing cost of the baht-denominated notes?

4. Based on your answers to the previous questions, do you think Blades should issue yen- or baht-denominated notes?

5. What is the tradefoo involved?
본문내용
Summary


The directors voted to establish
a subsidiary in Thailand

- Its initial estimates = 550 million Thai Baht(TB)
= $ 12.65 million (∵ spot rate = $0.023/TB)

- Now Blades has $2.65 million available

The remaining $10 million (=TB434,782,609)
should be obtained from other sources

CFO prefers 'debt' to equity financing to raise
the funds since Blades is a relatively small
company whose stock is currently undervalued

Smart Choice?

- Two alternatives for debt financing: $10 million yen or baht-denominated notes

A. yen-denominated notes are available in increments of ¥125,000

TB434,782,609 ÷ TB0.347826/¥ (spot rate) = ¥1,250,000,313

∴ ¥1,250,000,313 ÷ ¥125,000 =
10,000 yen-denominated notes

coupon rate = 10%

B. baht-denominated notes are available in increments of TB50,000



∴ TB434,782,609 ÷ TB50,000 =
8,696 baht-denominated notes

coupon rate = 15% (due to its unfavorable economic conditions)

The yen is expected to be appreciated
(versus the baht) in the future

- Since its future is uncertain, CFO
compiled the following probability





These expected appreciation of the yen should be
taken into consideration for effective financing
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