A foreign investment proposal may be a proposal to acquire a firm in the target country rather than start a venture from scratch.

Advantages and disadvantages of acquisition entry

Acquisition entry offers a company several potential advantages compared to new venture entry. They are only potential advantages because they depend critically on the choice of the acquired firm. A poor choice can transform a potential advantage into an actual disadvantage. The most evident advantage of acquisition entry is a faster starry in the target country. The investor gains control over a going concern with a product line, manufacturing facilities, managers, workers, and customers. To achieve the same market penetration through a new venture corned take several years. Fore the same reason a caution entry promises a quicker return on investment.

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