Ocean Carriers- Memo

To Whom it May Concern: Through thorough analysis, we believe that bloody shame Linn should purchase the capsize vessel assuming ocean Carries is operate from Hong Kong. We recommend this investment based on favor sufficient future day market conditions, location incentives, and positive net present look on (NPV) if the ship ope evaluate for 25 old age. Favorable Market Conditions Orders atomic number 18 intractable by the world economy and Ocean Carriers provide barely hope for promising future. With an estimated annual growth accession of approximately 1.5%, this entails future and constant business for the company. We hope that there entrust be a greater demand for our vessels. Changes in patterns can as well as affect the demand for long-term capsize orders. Ms. Linn is sure that in 2003, the Australian and Indian ore exports will further increase opportunities for business. If the market is high, we hope to lock in higher rates with our charterers Location: Hong Kong Assuming that Ocean Carriers is headquartered in Hong Kong, the company is able to take tax breaks on profits made abroad and no tariffs from disembarking cargo from Hong Kong. In fact, the location would be grand when Australian and Indian production in iron ore exports are anticipate to take reach in the next few long time.

The further the distance suppliers need the iron ore to be shipped, the greater our profits. Operating for 25 years generates Positive NPV We recommend that Ocean Carriers continues to operate their newly built vessel for 25 years instead of 15 years based on an expected 9% discount rate. Following company policy, we will not be operating our vessels that age over 15 years old. We have the option to scrap the vessel and sell the stigma to demolition yards to be valued at atomic number 23 million. We also have the option of selling the vessel as it is off to another iron carrier company. We can then suffer a higher salvage cost greater than five million, or lease the vessel and gain commission for a remaining 10 years. If Ocean Carriers decided... If you want to get a full essay, order it on our website: Ordercustompaper.com

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