AccessLine as an Attractive Investment
AccessLine is an attractive investment based on purely its technology and business prospects. For AccessLine to be a good investment to Apex, the AVC must be redesigned to give Apex a board seat and a lower share price. A new AVC will solve control and valuation issues, respectively. Given that AccessLine is confident in its prospects then compromising on the AVC should not increase the perceived risk of AcccessLine. The following explains why and why not AccessLine is an attractive investment and also states the risks associated with this investment.
AccessLine is an attractive investment opportunity as it offers service differentiation, critical to survival in the intensely competitive telecommunications industry, via being the first commercial system to deliver a broad array of personal communication services. AccessLine has shown signs of market acceptance and penetration via current strategic alliances and signed license agreements with major players in the market, initiatives with international carriers (projections of $35.2 mm in 1995 and $208mm by 1999) in Europe and Canada, and initiatives in dense and high consumer-demand geographies such as Hong Kong. (See Appendix X) AccessLine has shown that the demand of the personal number market is expected to increase by approximately 25% over the next 5 years. AccessLine being established since 1989 and recently experiencing a growth phase since 1994 provides Apex an investment opportunity that balances out its portfolio and hence increases the attractiveness of the investment. Most attractive is the steady cash flows that would be available from a late-stage investment such as AccessLine.
AccessLine is capable of a decent ROI and a feasible venture with e ...