Improve the firms organizational performance

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Archer Allison has just been appointed as the new CEO of Virta Corporation. The IT Company has had lackluster performance over the past three years and Archer was brought into to shake up the firm and get it going in the right direction for the future.

He has been presented the following four options by his CFO and his team of financial analysts. Review each and describe what impact you believe each one will have on the future performance of the firm. Discuss how TVOM factors in to each option. Please rank order the options from 1 to 4 in terms of impact on the financial performance of Virta.

1. Reduce the current $1.04 quarterly dividend by 50% and utilize the additional capital to improve the firm's organizational performance.

2. Buy back 1.2 Million common shares of Virta

3. Secure a $32 million dollar infusion of capital from an "Angel investor" for 10 years at 3%--the Company's current MARR is 8%.

4. Bring back to the US a manufacturing facility from Taiwan to South Carolina-the State tax incentive will net the firm $56 million over the next five years.

Reference no: EM13508934

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