Business Daily from THE HINDU group of publications
Monday, Jan 05, 2009
ePaper | Mobile/PDA Version | Audio | Blogs
Business Daily from THE HINDU group of publications Monday, Jan 05, 2009 ePaper | Mobile/PDA Version | Audio | Blogs |
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Mentor
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Overseas Borrowings Industry & Economy - Foreign Direct Investment Columns - For the Asking GDR vs FDI
Which one is better, GDR or FDI? Shoukat Aziz, Mumbai Well, from a company’s point of view both have their advantages and disadvantages. GDR (Global Depository Receipt) is raised through public issues and, hence, is more expensive in terms of administrative expenses. But on the flip side the company raising such funds is hardly troubled by foreign investors because the GDR holders do not enjoy voting rights. FDI (Foreign Direct Investment) is wholesale, as it were. The investment is made by a foreign company with deep pockets and sound technology. Naturally it would not be a mere sleeping partner like GDR holders. It is bound to be more assertive, intrusive and indeed may ask for veto powers in running the collaboration. So a company has to take a call. If it wants foreign capital sans their interference, GDR is what the doctor has ordered. But if technology is also desired then FDI is the only alternative. S. MURLIDHARAN ASK! Send in your queries to ask@thehindu.co.in http://MentorQA.blogspot.comMore Stories on : Overseas Borrowings | Foreign Direct Investment | For the Asking
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