Wooden Post Ltd Essay Example | Topics and Well Written Essays - 3250 words

Wooden Post Ltd - Essay Example Study of the case of ELITE HOTELS GROUP plc was done and the observations are indicated in the criteria for judging the adequacy of the solution. A vision of the WOODPOST LTD after consolidation is also conceived and presented at the end. The paper ends with a conclusion as also indicating the learning outcome. On strategic analysis of the market of WOOD POST LTD, the following three options are offered as viable long term strategies by a business consultancy firm of international reputation, to overcome the slow down of the business due to recent growth in United Kingdom market. For investment purposes, the 'life' of the project is assumed to be 10 years. All the cash flows are expressed in 'real' terms (that is, after allowance for inflation). In view of the relatively risky nature of the project, the Finance Director of WOODEN POST asserted that the 'normal' hurdle rate of 8% 'real' should be increased to 10%. But this has produced some debate among members of the management team some of whom considered that the effective cost of capital was zero since existing cash resources will be used. Quite apart from all these factors, further investigations into the acquisition established that cash