Massey-Ferguson Ltd
The problems of Massey-Ferguson Ltd. arose from the wrong debt policy of the company. In order to understand financial problems of MF it is necessary to investigate product-market strategy of the company and its financial policy, analyzing the financial statements of MF Ltd over some period of time and comparing them with other companies in the industry.
The product-market strategy of MF had the following features that had negative impact on financial health of the …
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…needed to be paid in one year, and more long term or equity financing. The company would not be in troubles in 1978 and 1980 if there were no such external problems as poor weather, increased interest rates and British pound etc. So in the future the company should take into account its debt capacity and leave enough room of cash for unexpected and unforeseen situations, in other words to take consideration the risks while planning strategies.
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