Baderman Island Resort Banderman organizations will face decisions to promote growth and expansion. Baderman Island Resort has become a premiere vacation and relaxation destination for tourist with optimal needs and likes. Some of the options faced are going public through an IPO, acquiring other organization within the same industry, or merging with another organization. The following will compare and contrast each of the options as well as analyze the strengths, weaknesses, and opportunity among the current choices.
The strength of an Initial Public Offering (IPO) Island Hotel Resort- BaderMan would continue to maintain complete control over the decisions that the Resort makes, they would be able to make improvements and expand with the money generated from the IPO, and the economic advantage of raising capital is a major strength, along with maintaining the founder’s vision. An IPO can also increase public awareness, investors who never heard of BaderMan resort will look in a direction that they may not have considered before the opportunity to invest presented itself
Weaknesses of an IPO One choice a company has is to introduce the IPO to the public. The IPO’s will have to be within the expected act established 1934 in regard to periodic finances that may be complicated for companies in the primary. Preparation for other systems and policies enforced by the SEC, these cost can be quite expensive. As they have increased with the arrival of the Sarbanes Oxley’s Act. “Some of the additional costs include the generation of financial reporting documents, audit fees, investor relation departments and accounting oversight committees”( Investopedia 2006)
Merger, Strengths vs. weaknesses:
Strengths if the company were in a financial bind than a merger would be in the best interest of the company the strength of the merger would be