Asset Stripping

-

The process of buying an undervalued company with an intention to sell off its assets and generate profit for the shareholders is known as asset stripping. The individual assets of the company such as its equipment, real estate, intellectual property or brands, would be more valuable than the company as a whole due to certain factors like poor management or economic conditions. Its result is often a dividend payment for the investors and either a less-viable company or bankruptcy.

Asset stripping is an action that is often engaged in by corporate raiders who buy undervalued companies to extract value out of them. This was very popular during 1970-1980s and is still seen in some of the investment activity conducted by private equity firms.This activity makes a company weak, especially one that has less collateral for borrowing and may have its value-producing assets stripped out, making it less able to support the debt the company has. The proceeds gained from asset stripping would be used to pay down the company’s debts and also, it will be utilised to pay off the shareholders with dividend. For example, retailers owned by private equity companies that have engaged in asset stripping and recapitalization are more likely to default on debt.

About RCBS: The best Business (b schools) schools in Kerala, RCBS welcome you to grow your career into the next level. RCBS is popular as one of the best MBA Colleges in Kerala with AICTE and NBA accreditation which offers courses like MBA, MHRM, PGDM and International MBA. Grab your admission at one of the best b schools (business schools) in Kerala, RCBS. Visit website

Comments

Post a Comment

Popular posts from this blog

Bridge Loan

-
Image
A short term loan that is used until a person or company secures permanent financing or removes an obligation that is currently existing is called as a bridge loan. Bridge loans allow users to meet their current obligations by providing them with immediate cash flow. They are short-term loans that has relatively higher interest rates and are usually backed by a collateral like real estate or inventory. In UK, it is usually called as bridging loan, caveat loan or swing loan. They are typically more expensive than other conventional methods of financing. Also, they come with a higher rate of interest, points and other costs that are amortized over a shorter period, and various sweeteners like equity participation by lender in some loans. Bridge loans are arranged quickly in a short period of time with relatively less documentation. Bridge loans in real estate is used for quickly closing property purchases, to retrieve real estate from foreclosure or to take advantage of short-term
Read more

4 REASONS TO DO AN MBA IN KERALA INDIA

-
Image
Apart from other post-graduation courses, MBA is a distinguished degree that enables individuals to excel in their professional career path. A professional looks for several degrees to boost his career. The most common post-graduation degree in India pursued nowadays is MBA. This post-graduation course holds immense importance in the thriving market scenario. The prime aim of MBA degree is to create an entrepreneur or a professional who can manage all parameters of a business. But still many students in our country are skeptical about pursuing MBA course for several reasons. Here Are 4 Reasons To Do An MBA Program In Kerala India 1. Career Growth You may start your career mostly in an operational role. After working smartly and putting a lot of hard work you’re getting a promotion. And after that your promotion even with good work experience may limited to an extend due to academic profile. Pursuing an MBA degree can switch your career path to a much higher profile with la
Read more

SIGNIFICANCE OF PURSUING MBA IN A ROBUST ECONOMY LIKE INDIA

-
Image
An MBA degree is considered as one of the best post-graduation course across the globe is also growing by leaps and bounds in India. With several MBA colleges in Kochi Kerala India have included MBA courses in their curriculum and graduates are opting for those respected MBA courses. Many international students are also eyeing MBA courses in Kerala India giving the reputation of Business Schools situated here. There are various types of MBA courses that you can choose anyone depending on your interest and criteria. Most of the students are going for full time MBA courses right after they complete graduation degree. The Indian scenario of students thriving to MBA courses is also because that Indians are gradually started moving from an agricultural-based economy to a business and knowledge-based economy. Several types of careers are benefited by MBA courses as it helps to increase the knowledge about the market and business world and adds a handsome pay package. In a recent
Read more