Huffman Trucking and Expansion Strategies

Running Head: HUFFMAN TRUCKING

Huffman Trucking and Expansion Strategies

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Huffman Trucking is a national transportation company which is seeking expansion and has three alternative strategies available. The strengths of each of the strategy are as follows:

Going Public

The decision to go public is a critical one as it results in dilution of ownership stake and diffusion of corporate control. The first public author of securities by a company since its inception is called as an Initial Public Offering (IPO). In a financing strategy, the main purpose of the IPO is to raise funds for the company (Financial Management for Managers, 2004). Our Company seeks to become a growing, profitable, and adaptive company in an extremely competitive business environment of logistical services. It has been in operation for the last 70 years and has been earning adequate profits and following a trend of growth in its net income.

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The Initial Public Offering (IPO) Prospectus for A...

Advantages of Going Public

Facilitates future funding by means of subsequent public offerings;

Enables valuation of the company;

Provides liquidity to existing shares;

Increases the visibility and reputation of the company;

Commands better pricing than placement with few investors;

Enables the company to offer its shares for future mergers & acquisitions.

Mergers and acquisition

It is believed that mergers and acquisitions are strategic decisions leading to the maximization of a company's growth by enhancing its production and marketing operations. They have become popular in the recent times because of the enhanced competition, breaking of trade barriers, free flow of capital across countries and globalization of business as a number of economies are being deregulated and integrated with other economies.

Merger

A merger takes place, when two or more companies fuse and make a single company. One or more companies may merge with an...