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P. 10
THE FINANCING DECISION
Uses of foreign finance
• Foreign finance is used predominately by large
companies, for the following reasons:
• To obtain access to finance, where local sources of
finance is limited.
• To diversify the sources of finance.
• To refinance existing debt.
• Foreign finance may be more affordable than local
finance.
• To act as a natural hedge, where the company earns
foreign income.
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