| Popis: |
To stay competitive, firms have to keep up a certain investment expenditure flow, and in addition, have to be in a position to take advantage of unexpected investment opportunities, which come up irregularly. The challenge for today’s CFOs is then to overcome the silo approach of financial institutions, and instead develop a strategic perspective on capital structure management based on maximizing equity value and optimizing reserve borrowing capacities throughout the business cycle. When managing the corporate capital structure, CFOs invariably are confronted with two fundamental questions: First, should they return excess cash to shareholders, save it, or invest it in positive NPV projects, and second, should they finance new growth opportunities by adding debt or drawing on equity? Indeed, achieving the optimal capital structure – the composition of debt and equity that a company uses to finance its operations and strategic investments – has attracted considerable attention from academics and practitioners alike. |
