Prior to beginning work on this discussion, read Chapter 13: Risk and Capital Budgeting in your textbook.
Acquisitions are often risky investments for a company. On December 1, 2017, Deere & Company decided to acquire the stock and certain assets of almost all of Wirtgen Group Holding’s operations. For this discussion, address the following:
- Describe the concept of risk as it pertains to investment decisions.
- Explain how companies measure the level of risk related to a given investment decision.
- Discuss risk factors companies should consider with acquisitions.
- Explain which of these risk factors you see at play in the Deere & Company acquisition.