What would consider in addition to the financial performance

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LAGER Ltd, a reputable company, listed on the stock exchange, has had the following balance sheets over the last 3 years (expressed in $million).

It is considering investing $25 million in a new fixed asset, and has asked you, its banker, to finance the entirety of this amount by a five years loan.

Problem a) Assuming the need to invest $25 million was well founded, would you, from a pure risk perspective, approve the loan? Why and why not? (Justify your analysis with the appropriate financial ratios).

Problem b) What other factors you would consider in addition to the financial performance in (a) to grant the loan to LAGER Ltd.? Why?

Reference no: EM133012631

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