Huffman Trucking is a company founded by K. Huffman back in 1936. World War II helped Huffman Trucking to move forward increasing their demand between the Midwest ports all the way to the East Coast ports offering their carrier services. Huffman Trucking started with only a single tractor-trailer and nine years later the company increased their size to 36 trailers. The U.S. Government, manufacturers of plastics products, and electronic consumer products are some of the primary customers who Huffman Trucking works with. With facilities in Cleveland, Bayonne, St. Louis, and Los Angeles Huffman Trucking employs over a thousand personnel divided between drivers and support personnel. Team B analyzes the best option for Huffman Trucking between going public through an IPO, acquiring another company within the same industry, or merging with another organization. Comparing the strengths, weakness, opportunities, and threats of all three options will help Team B to make a smart decision.
Strengths of Each Approach
Huffman’s Trucking has many advantages for a going public. The most distinct advantage is the financial benefit in the form of raising capital. Huffman’s capitals are to fund research and development, fund capital expenditure or even used to pay off existing debt. An increased public awareness of Huffman’s company is another advantage because IPOs mostly gain publicity by making potential customers aware of their products. This may cause an increase in market share for the company. Many companies have to cash in on the success of companies that they helped start-up using IPOs (Investopia, 2010).
Advantages of Huffman merging and acquisitioning are to determine the short -term and long-term company strategic outlook of the new and determined company. This is many factors such as market conditions, differences in business culture, acquisition costs and changes to financial strength surrounding the corporate takeover (Berry, 2002-2010)
A merger is