Chemfree has the rights to distribute a line of environmentally friendly pest control products in Canada and abroad. Under the leadership of the president and controlling shareholder, the business has experienced considerable growth since its creation a few years past and is poised for even more rapid growth in the future. The company requires a significant sum of money to finance its seasonal financing needs as well as this growth. Four alternative means of financing are being contemplated including two corporations and two venture capital firms. All the choices involve a dilution in the president's equity interest and he must choose which choice is most proper.
Learning Objective:
To learn about the fiscal challenges confronting growing firms.
To learn about the factors entering into the sale of a business.
To learn about the role of patents in valuing a business.
To learn about the nature of labour sponsored venture capital funds and the nature of SDI.
To learn about the development arm of the State of Quebec.
Publication Date: 09/19/1995
This is just an excerpt. This case is about Finance
