Productos Alimenticios Excelsior, S. A./Excelsior Food Products, INC

In late February 2007, Ernesto Ávila, CFO of Productos Alimenticios Excelsior (PAESA), was about to assess three proposals to finance a product line expansion project in the company. Both the Board of Directors and the management team considered this project, known as Alpha Project, to be profitable...

Full description

Saved in:
Bibliographic Details
Published inAcademia (Consejo Latinoamericano de Escuelas de Administración) no. 44; p. 115
Main Author Marín, José Nicolás Marín
Format Journal Article
LanguageSpanish
Published Bogotá Emerald Group Publishing Limited 01.05.2010
Subjects
Administrative Organization
Boards of directors
Cost Effectiveness
Food processing industry
Governing Boards
Product lines
Profitability
Studies
United States > US
Online AccessGet full text

Cover

More Information
Summary:In late February 2007, Ernesto Ávila, CFO of Productos Alimenticios Excelsior (PAESA), was about to assess three proposals to finance a product line expansion project in the company. Both the Board of Directors and the management team considered this project, known as Alpha Project, to be profitable and strategically important. Investment in facilities, machinery, and equipment had been estimated at US$5 million. The Board of Directors was to meet in a few days, and the most important item on their agenda would be deciding on PAESA's most desirable financing method. Mr. Ávila was studying three specific funding possibilities: a five-year subordinated bank loan, an issue of cumulative preferred stocks, or an equity increase. Selecting the most suitable financing would be based on a cost analysis, a risk-creditworthiness assessment, and likely variations in company control. The Board of Directors also had to take into account such factors as future financial flexibility and borrowing policy changes in a family-owned business resulting from a change in CEO. [PUBLICATION ABSTRACT]
ISSN:1012-8255
2056-5127