Large corporations endeavor to diversify globally to enhance their competitiveness, profitability, and market presence. This is a crucial provision when considered critically with respect to the Marisa Corporation’s case provided. The company should consider numerous issues before establishing its operations internationally (Choi & Meek, 2010). It is important for the business to operate beyond the United States. However, a critical business approach addressing internationalization issues must be applied. This will allow the company to focus on its business while enhancing its profitability, appropriateness, and market relevancy. Diversifying operations abroad will be quite appropriate in this context. Nonetheless, it will require appropriate decisions made about trade weighted-index and other financial obligations.
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In the context of the provided case, MBI does not provide the best acquisition partner for Marisa Corporation. This is based on its trade weighted-index use weighted index its financial viability. It is evident that MBI experienced fluctuations in its average trade weighted index from 2002 to 2008. This indicates a critical trend with respect to global trade. In spite of the fact that 60% of its revenues are attained from foreign earnings, it is inappropriate to acquire MBI Corporation due to numerous reasons concerning the trade weighted index (Bloch, 2003). Concurrently, the company is hardly transparent with its financial statements as evidence in the case. Marisa Corporation serves the right to comprehensively understand the organization, which suits its business objectives. Evidently, trade weighted-index is important in determining whether a company is viable for a merger or not. Based on the knowledge acquired from Chapter 6 of the study, it is crucial to agree that MBI can hardly make a viable acquisition partner for Marisa Corporation. As the company’s CFO, it is necessary to argue against the choice and search for other viable partners. This will help in diversifying the company’s operating risks and augmenting its business prospects with promptness (Choi & Meek, 2010). It is also important to argue against the choice as indicated earlier. The trend demonstrated by the BMI’s financial provisions and other relevant provisions presented in the case is critical. One should understand various aspects of international trade (with respect to mergers and acquisitions) before partnering with any company.
In addition, based on the foreign financial statistics of the company (MBI), the increase in its net earnings from 2006 to 2008 is quite minimal. Despite an increment in the total value of its assets, MBI still remains the worst acquisition partner for Marisa Corporation. The trade weighted index assumed by the company is unsuitable when considered critically. This is applicable although MBI performs better than other considerable companies with respect to international business. As the CFO, opting for another company will be helpful in this context (Bloch, 2003). This will help in diversifying the company’s operating risks and augmenting its viability and global presence as indicated before. Based on the presented argument, it should be mentioned that Marisa Corporation’s demands with respect to internationalization, market diversification, and competitiveness. Such understandings should be taken into consideration before acquiring any business partner. Conclusively, Marisa Corporation should go for other viable business partners (with considerable financial transparency) in order to enhance its diversification dreams. This will assist in acquiring a multinational organization established globally. Additionally, it is prospective that the company has a viable stock market projection.
Bloch, H. (2003). Growth and development in the global economy. Cheltenham, UK: Elgar.
Choi, F., & Meek, G. (2010). International Accounting. Upper Saddle River, NJ: Pearson Education.