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International Finance of Barclay Bank : Report

   

Added on  2020-01-21

10 Pages2858 Words61 Views
INTERNATIONAL FINANCE

TABLE OF CONTENTSINTRODUCTION.......................................................................................................................................3TASK 1.......................................................................................................................................................3(A)Ratio analysis of WPP........................................................................................................................3TASK 2.......................................................................................................................................................4(A)Advantages and disadvantage of three valuation methods.................................................................4(B) Valuation on the company.................................................................................................................6© Different valuations by different models.............................................................................................7(D) Risks faced by FTSE 100 company...................................................................................................7(E) Impact of the factors like disposal of asset on the choice of the valuation method............................8TASK 3.......................................................................................................................................................8(A)Recommendation to Barclay bank in respect to acquisition of the WPP PLC....................................8CONCLUSION...........................................................................................................................................9REFERENCES..........................................................................................................................................10YTable 1 Ratio analysis of WPP PLC............................................................................................................3Table 2 Asset valuation by using PE ratio, dividend discount model and NAV..........................................6

INTRODUCTIONAcquisition is the way that is adopted by the most of business firms in order to expandtheir business at the rapid rate across the globe. In order to take wise decision in respect toacquisition of the other company managers often use ratio analysis method. In the present caseratio analysis of the firm is done and comments are made on same. Apart from this, differentvaluation methods are applied share fair value is computed. At end of the report,recommendation is given in respect to acquisition of the business firm.TASK 1(A)Ratio analysis of WPP Barclay bank is one of leading bank in the UK which is very popular among the people for itsservices. Mentioned firm wants to acquire FTSE 100 Company in its portfolio. Before acquiringan FTSE 100 company which is WPP PLC it is necessary to evaluate its business performance.In this regard ratio analysis is done and its interpretation is given below.Table Ratio analysis of WPP PLCWPPOperating profit1632Net sales12235Operating profit ratio13%Net profit1245Net sales12235Net profit ratio10%Current assets13375Current liability14215Current ratio0.94Debt4661Equity8015Debt equity ratio0.58InterpretationOperating profit ratio: Operating profit ratio reflects the proportion that operating profithave on sales of the firm (Schulze, Skiera and Wiesel, 2012). It can be observed from the

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