ACCA Strategic Professional · Strategic Business Leader · Strategic choices
Solace Telecom wants to enter a market where regulations restrict foreign ownership, speed matters, and it lacks local licences. Which development method is most appropriate given these constraints?
An alliance or joint venture with a local partner is most appropriate. It gets round foreign ownership limits, provides licences and local knowledge, and allows faster entry than building from scratch. Full acquisition and wholly owned start-up are blocked by the restrictions, and divestment does not achieve entry.
- AWholly owned organic start-up
- BFull acquisition of a local operator
- CAlliance or joint venture with a local partnerCorrect
- DDivestment of existing operations
Explanation
Foreign ownership restrictions rule out full acquisition or a wholly owned start-up, and a local partner supplies licences and speed. An alliance or joint venture fits these constraints. Divestment is not a way to enter a market.
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