Euroland Foods S.A. is one of the leading European producers of ice-creams, yogurt, bottled water, and fruit juice. After a brief overview of the given case study, the first part of the first question will evaluate the extent to which the various given me

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Introduction

This work is aimed to research certain questions, given. Euroland Foods S.A. is one of the leading European producers of ice-creams, yogurt, bottled water, and fruit juice. The Capital Budget was to discuss in the Board of Directors. 11 major projects totaled EUR 316 million were up for consideration. However, the limit was set at EUR 120 million. The challenge for the senior management of Euroland Foods S.A. was to allocate funds among a range of compelling projects.

After a brief overview of the given case study, the first part of the first question will evaluate the extent to which the various given measures of economic investment have provided a good justification for the three projects to be approved.

The second part of the first question will present my recommendations on the displacement of any or all of the approved projects.

In the second question I will provide a discussion paper for the Corporate Social Responsibility, considering several significant “triple bottom line” benefits and the nature of any potential social and environmental costs arising.

Euroland Foods S.A.

Euroland Foods, headquartered in Brussels, Belgium, is a multinational producer of high-quality ice cream, yogurt, bottled water, and fruit juice. Its products are being sold throughout Scandinavia, Britain, Belgium, the Netherlands, Luxembourg, western Germany, and Northern France.

The company was founded in 1924 by Thei Verdin, a Belgian farmer. The company went public in 1979, and, by 1993, was listed for trading on the London, Frankfurt, and Brussels exchanges. In 2000, Euroland Foods had sales of almost EUR 1,6 billion.

Ice-cream is accounted for 60% of the company’s revenue: yogurt, which was introduced in 1982, contributed about 20%. The remaining 20% of sales was divided equally between bottled water and fruit juices. Euroland Food’s flagship brand name was “Rolly”. Ice cream, the company’s leading product, had a loyal base of customers who sought out its high-butter-fat content, large chunks of chocolate, fruit, nuts, and wide range of original flavors.

Ownership

Euroland Food’s 12 member board of directors included three members of the Verdin family, 4 members of management, and 5 outside directors. Members of Verdin family owned 20% of Euroland Food’s shares outstanding, and company executives combined owned 10% of the shares. Venus Asset Management, a mutual-fund management company in London, held 12%. Banque du Bruges et des Pays Bas held 9% and had one representative on the board of directors.

Members of the Board

  • Wilhelmina Verdin (Belgium), PDG, 57;
  • Trudi Lauf (Swiss), Finance Director, 51;
  • Heinz Klink (German), Managing Director for Distribution, 49;
  • Maarten Leyden (Dutch), Managing director for Production and Purchase, 59
  • Marco Ponti (Italian), Managing director for sales, 45
  • Fabienne Morin (French), Managing director for marketing, 41
  • Nigel Humboldt (British), managing director for strategic planning, 47
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Question 1 (a)

Three projects out of 11 major are to be approved by the Board of Directors.

  • Market Expansion Southward (#7) (EUR30 m) – Sponsoring Manager Marco Ponti
  • Developing and introduction of new artificially sweetened yogurt and ice-cream (#9) (EUR 27 m) – Sponsoring Manager Fabienne Marin
  • Acquisition of a leading schnapps brand and associated facilities (#11) (EUR 60 m) – Sponsoring Manager Nigel Humboldt.

Total price of three projects – EUR 117 m

Analyzing the projects we can see that from the first view, they are extremely beneficial. The IRR ...

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