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Ifm Plc Consultancy Report

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Submitted By bochumfreak
Words 3668
Pages 15
Leeds Metropolitan University
4/30/2012

IFM PLC | Consultancy Report |

Financial Analysis and assessing future options for the company |

Mohamed Kamara and Iwi Ugiagbe-Green

Jens Hagenbeck ID: 33269369

Executive Summary

This consultancy report aims at the Board of Directors of IFM Plc a multinational company providing financial services and was being ordered by Finance Director Mrs. Diana Worth. It analyses and evaluates a prospective joint venture between a German subsidiary and EMF Plc, re-domiciling the parent company from France to Monaco and expanding into Asia.

The financial analysis showed that a joint venture requires an €2 million investment, which could be funded by the shareholders offering a yield of return of 12%. Using the financial data provided and calculating the weighted average cost of capital and the Net Present Value, a WACC of 10% and a NPV of €2.051 million were the results, proving the worthiness of the investment into the joint venture. Before signing any agreements further research needs to be taken to evaluate non-financial aspects such as opportunity costs and other investments.

The second part of the report deals with the re-domiciling of the parent company from France to Monaco. From a business perspective and logical point of view this step makes sense as a lot of business operations are being run in Monaco, but it could still damage the company’s image to move from France just for profit and also shareholders might not like the idea.

Furthermore IFM Plc plans on expanding into Asia, especially China and India to achieve a growth of 5% over the next 5 years. This is a decision worth doing but bears high risks as a high investment of €250 million is needed and the company already has a gearing level of 88%. The report states several options to lower the gearing level and receive funding but it is still

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