Sportswear

Chris Kenney writing in Mergers & Acquisitions: The Dealermaker'sJournal suggests that studies suggest that when it comes to acquisitions,acquirers generally lose. Equally important, she needs to determine herlevel of sensitivity to risk and reward. Ideally, Richards willbe willing and able to provide this financial data for the last five yearsso that Olivera can examine trends in the company's financial performance.Olivera needs to have a certain amount of skepticism about Richards' claimthat the decision to try to sell the business is based on something asvague as "health problems." It is possible the health problems thatRichards is most concerned about involve the financial health of hiscompany. She wonders how successful she will be if she acquires the companyand tries to grow it. Olivera recognizes it will be difficult to increase productioncapacity by automating certain operations if she purchases Sportswear andat the same time to pay Richards at a rate of $41,666 per year for the nextsix years. Olivera will want to review the company's full financialstatements including the unabridged version of Sportswear's incomestatement, balance sheet