High dividends in order to reinvest more capital into firm

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Bubba Seafood currently executes a strategy of not paying high dividends in order to reinvest more capital into the firm. For several years the firm has been highly profitable and this strategy has allowed Bubba Seafood to pursue several strategic projects that have added to the firm’s continued growth. Bubba Seafood would like to expand into several less developed countries and plans to finance those expansions with local debt to reduce exposure to country risk. What do you think of this strategy? What are the issues facing Bubba Seafood and what solutions do you propose?

Reference no: EM131548370

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