CIMA Financial Strategy F3 Question # 95 Topic 10 Discussion

CIMA Financial Strategy F3 Question # 95 Topic 10 Discussion

F3 Exam Topic 10 Question 95 Discussion:
Question #: 95
Topic #: 10

MAN is a manufacturing company that is based in country M and sells almost exclusively to customers in country M, priced in the local currency, M$.

 

MAN wishes to expand the business by acquiring a company that manufactures similar products but has a more global customer base. It is particularly interested in selling to customers in country P, which uses currency P$ but recognises that the P$ is generally quite volatile against the M$.

 

Country P uses the same language as country M, has free entry of labour from country M, no exchange controls or withholding tax and a favourable double tax treaty.

 

Which of the following companies would be most suitable takeover candidates for MAN to investigate further?


A.

A company based in country M with a global customer base including country P.


B.

A company based in country P with a global customer base including country P.


C.

A company based in country M with a shared interest in selling in country P.


D.

A company based in country P with a large proportion of customers in country M.


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