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I. Summary In summer 2002, with total sales of (euro) EUR53.9 one thousand million from much than 5,200 stores, crossbreeding S.A was French largerst retailer. Carrefour S.A was considering alternative currencies for aggrandizement (euro ) EUR 750 jillion in the Euro baffle market. Its investment banks, Morgan Stanley and UBS Warburg, had suggested that carrefour to consider acceptance in british pounds sterling in position to deliver service of a borrowing opportunity in that capital in Carrefour attempt of fund it expansion. II. Objective Carrefour has a debt-financing exigency of EUR 750 million debt financing at a lowcost by issuing it follow either in domestic countrys (France) funds or issue forigen currency denominated hamper in the Eurobond market and it chooses to issue a 10-year bond to finance the need. in that respect are four choices of bond market, would be priced at a voucher grade of 5.25% in Euro, 5.375 in British Pound, 3.625% in Swiss F rancs and 5.5% in US dollar bills. Issuing in contrary currencies leads to different coupon rate, currency evaluate and economic environments (including hobby rete, inflation, and so on). In order to choose issuing in which currency is well-nigh efficient, comparison is needed. III.

Analysis From exhibit 7 we layabout irritate Spot Exchange Rate : Row money/|  |  |  |  | tug Currency| Euro| British Pound| Swiss Franc| U.S sawhorse| Euro| 1| 1.593| 0.688| 1.02| British Pound| 0.628| 1| 0.432| 0.64| Swiss Franc| 1.453| 2.315| 1| 1.482| U.S Dollar| 0.98| 1.562| 0.675| 1| So, we can compute 750 million bond assess for each cu! rrency and the annual payment wedge value| 750 M Euro| | Currency| Bond value (in M)| voucher rate (in %)| Annual payment (in M)| Annual payment (in M €)| Euro| € 750| 5.25| € 39.375| 39.375| British Pound| £ 471| 5.375| £ 15.898| 40.328| Swiss Franc| SF 1089.75| 3.625| SF 57.398| 27.178| US Dollar| $ 735| 5.5| $ 40.425| 41.233| establish on data above,...If you want to get a wax essay, order it on our website: OrderCustomPaper.com

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