Based on the following information about a fake company (no research necessary) please answer the questions. You can either answer in the space below or upload a file.

1. Cydefex, a large US pharmaceutical company with no international operations, is considering raising long term debt financing in international capital markets. The company is receptive to raising the funds in currencies other than USD and has asked you for advice.

• Please provide two reasons in favor of issuing debt in international markets.
• List the information necessary to compare issuing debt in the US domestic bond market, USD denominated debt issued outside the US, and foreign currency denominated debt.

• If Cydefex elects to issue EUR denominated bonds explain the transactions the company could use to hedge the foreign exchange risk.
• Since you gave such excellent advice on a successful bond issue Cydefex wants to expand globally through an international investment, and is asking you for advice on:

• Acquiring a local manufacturer
• Licensing production of their proprietary drugs
• Making a greenfield investment.

Please comment on the relative benefits, and risk of the three options above, and describe a suitable host country.

1. Upon learning of their expansion plans you also recommend listing the company stock on foreign stock exchanges. Why did you make the recommendation?

Cydefex has decided to build a plant in Brazil and take advantage of subsidized development financing offered by the local development bank, BNDES (no need to look it up, this is not a research project). Please describe the method for evaluating the investment using Adjusted Present Value and list the data you would need to determine whether to accept or reject the project from the Cydefex perspective