Company Acquisition

Name

Institution Affiliation

Investment decisions are complicated, and without critical consideration of the possible implications can mean the beginning of an end to a business. While these critical decisions present a potential for increased popularity within the industry of operations, gaining a competitive advantage surpasses all corporate aspirations. However, according to Chirinko & Schaller (2011), in the process of making investment decisions; such as acquiring another company through purchase, integrating with another company, or forming a partnership, a firm faces various obstacle. As such, when these obstacles are not addressed adequately, a company investment effort will be futile. Due to increased changed in the way business investments are done in the contemporary world, business managers have an equally increased role in navigating the obstacles that they may face in the process of fulfilling stakeholder interests.

In the case of Li Shufu and the challenges that he is facing in the acquisition of Volvo, there are several strategies that he can be adopted to minimize the constraints. First, Li Shufu should consider foreign direct investment to overcome the notion that his company, Chinese Geely Group, is a weak market performer. As such, Li Shufu will position his company is competitive edge among the Chinese and global competitors. This approach does not only increase the sale for the company but also secure a broader market segment for selling its products after acquiring Volvo. 

Secondly, to navigate the challenge of lack of support from the Chinese government, Li Shufu should consider making Geely a publicly traded company in compliance with the regulatory requirement. This approach will enable the firm to interact with Chinese citizens effective hence may gain government support for improving economic situations. Most company that gain government support are those that have a promising economic return and, more so, that can help the citizens by improving their livelihood. Hence, the major position of the Chinese government is enabling Li Shufu and his company, Geely, by proving long-term loan that can be used to acquire Volvo and better the internal operations. Besides, by instilling a promising and sustainable contribution to the Chinese economy, the company may be listed among those enjoying the subsidies and some tax exemption.