Alliance Cement Case Inquiries
Each crew should prepare a written survey (2 to three pages) with this case. You should ensure you answer the following questions in your record. Note that problem 1 requires you to execute a financial projection of Cha?non Concrete's 06\ financial claims (using Excel). One group will be picked at random to lead the class debate on the case and present their 06\ financial predictions. 1 . What is your best approximate of the 06\ financial transactions? As a starting place, assume that Bijou makes the anticipated $3 mil dividend payment to Countrywide. Hence, the balance sheet will probably be balanced simply by adjusting the amount of the bank financial loan. This implies a possible renegotiation with the bank. When the forecast is completed, consider the end results on the funding amount via changing the dividend or capital expenses choices. (See attached excel files together with the 2 cases (pessimistic and the most likely). In both myself need a loan from the financial institution to meet every commitments with the company, payouts, CAPEX and Bank Debt) 2 . Bijou must choose between
a. making the key repayment for the bank,
b. producing capital assets, and
c. producing the gross payment to National.
What is your suggestion, and what is the justification?
n. making capital investments so that the firm can survive in the market. Otherwise it is impossible to achieve the earnings and to continue its operations.
3. Suppose you decided to renegotiate with the bank вЂ“ how would you approach the lender, and what arguments would you put forward? Now that the company will probably be in a better shape the coming year,
Ingesting consideration the most likely scenario, we suggest renegotiating with all the bank to have a new bank loan based on the reduction from the Debt as a percentage of Revenue Proportion in a crisis environment, which is a good accomplishment of the managing team in the firm. Ratio| 2002| 2003| 2004| 2005| Forecast
Debts as a % of...