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Long-term financing instruments and strategies

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Please provide information on long-term financing instruments and strategies for Apple computer.

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Solution Summary

Long-term financing instruments and strategies are discussed.

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Various Options of raising finances:

1. Issue of Equity Shares
Equity can be raised either by private placement or by public. Intel has got strong track record; thus it can use this route to raise money. It has following features:

Claim on Income and Assets:
Shareholders have the claim on income and assets of the firm.
Right to Control
Voting Rights
Pre-Emptive Rights
Limited Liability
Advantages of raising shares
Permanent Capital: It need not be paid back
Borrowing Base: It can be used to trade on equity
Dividend Payment Discretion: The payment of dividend is in the hands of management

Disadvantages
Cost: It is more costly than debt
Earnings Dilution: It involves reduction in ...

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