1. Foreign Investment
Introduce yourself and about the company.

2. Our Strategy To create Value for stakeholders.
To become cost effective.
To differentiate product (on the basis of design, quality, after sales service).
Harvard Business School's Michael Porter developed a framework of generic strategies that can be applied to strategies for various products and services, or the individual business-level strategies within a corporate portfolio. The strategies are (1) overall cost leadership, (2) differentiation, and (3) focus on a particular market niche. The generic strategies provide direction for business units in designing incentive systems, control procedures, operations, and interactions with suppliers and buyers, and with making other product decisions.
The aim of pursuing any one of the strategy is to:
How to create value for the organization

3. Foreign Investment Viable Options: Exports Joint Venture Subsidiary
Green Field Project
Merger and Acquisitions
Franchisee
Licensee
First, Australia is located in the Pacific and Asia. It is one of the most developed countries in the world. Our business can be profitable here as it has high purchasing power and life expectancy within Australia is approximately 80 years of age which is very high ( Their elderly is expected to grow approximately 10% over the next few decades, which is one of the highest rates internationally. This growth proves to be a large opportunity for us as our product sales with the proper marketing and target market could increase with this population.
However, the strict laws, harsh punishment and the strong cultural beliefs can prove to be a risk for possible expansion. However, the ethics in business throughout this nation are prevalent. The parties are raised to value family, culture and especially sport! These values are demonstrated within their business ethics and they expect the same from their international partners.
Continue to talk about various options. You can use the following website for more information:

4. Risks with International Business
Foreign Currency Exchange Risk
Adjustment of WACC according to the risk
Country risk
Problem in calculation of Beta
One factor that distinguishes the international investment decisions from the domestic investment decisions is that cash flows are earned in foreign currency. This fact should be considered while estimating the incremental cash flows. Moreover Firms must constantly assess the business environments of the countries they are already operating in as well as the ones they are considering investing in. This WACC should be adjusted by the country risk.
It involves country risk analysis, the assessment of the potential risks and rewards associated with making investments and doing business in a country. This is the subject matter of political economy—the interaction of politics and economics. Such interactions occur on a continuous basis and affect not just monetary and fiscal (tax and spending) policies but also a host of other policies that affect the business environment, such as currency or trade controls, changes in labor laws, regulatory restrictions, and requirements for additional local production.
By extension, the international economic environment is heavily dependent on the policies that individual nations pursue. Given the close linkage between a country’s economic policies and the degree of exchange risk, inflation risk, and interest rate risk that multinational companies and investors face, it is vital in studying and attempting to forecast those risks to understand their causes.
There can be various Country-Specific Risks. It affect both domestic and foreign firms that reside in a host country. These risks, which arise from the actions of the host government, apply more to the multinational corporation whose cash flows are impacted. Examples include exchange controls, currency inconvertibility, and blockage of funds.
Exchange Controls
A common policy of host governments facing balance-of-payments difficulties is to impose exchange controls that block the transfer of funds to nonresidents.
Currency Inconvertibility
Some governments will not permit conversion of the local currency into another currency
Blockage of Funds
Subsidiaries of MNCs typically send funds back to their parents to repay intercompany loans, remit dividends, and pay for supplies and other administrative services. When host governments experience a foreign exchange shortage, they may block the transfer of funds back to the parent.
Currency exposure
The general concept of exposure refers to the degree to which a company is affected by exchange rate changes
Problem in calculation of Beta
Beta of a foreign investment can be calculated by regressing the project’s return to a benchmark market index. In fully integrated international financial markets, both the firms and the individual investors are free to invest anywhere in the world. In this case, the project’s cost of capital does not depend on any country. Investors could diversify internationally and obtain the international diversification benefits themselves. In this case, beta is calculated relative the world market index.

5. Recommendation Joint Venture Benefits Spreading costs and risks
Improved access to financial resources
Economies of scale
Access to new technologies and customers
Access to innovative managerial practices
Complimentary Business
A joint venture (often abbreviated JV, and sometimes known by the older term joint adventure) is a strategic alliance between two or more parties to undertake economic activity together. The parties agree to create a new entity together by both contributing equity, and they then share in the revenues, expenses, and control of the enterprise. The venture can be for one specific project only, or a continuing business relationship such as the Sony Ericsson joint venture. A joint venture is often seen as a very viable business alternative in this sector, as the companies can complement their skill sets while it offers the foreign company a geographic presence.

6. Issues Differences in language, culture and management practices?
Share purchase or Share swap
Terms and Conditions of agreement
Resources and Rights to be transferred? (technology, copyrights, trademarks)
How to transfer resources (Purchase, license)

7. Limitations of Strategy
loss of control over technology
limited ability to realize experience curve and location economies
limited ability to coordinate int’l strategy against competitors
conflicts between partners over goals and objectives of the JV
Sharing of Returns or Ownership
Lack of Trust on Partner
Partner may back out or inefficient
Therefore it involve medium risk and medium return strategy. It involves sharing of ownership and profits. The alliance partner must be carefully chosen.

8. Strategies to Avoid Wholly owned subsidiary High Risk High Return
A private entity builds and operates a new facility for the period specified in the project contract.
It will involve high commitment of resources as it involves capital investment like purchasing its own assets in an international country. It involves the highest risk and in turns the chances of highest return.

9. References
Gilpin, R. (1986) U.S. Power and the Multinational Corporation- The Political Economy of Foreign Direct Investment
Sullivan, arthur; Steven M. Sheffrin (2003). Economics: Principles in action
David William Carr. Foreign Investment and Development in the Southwest Pacific
A private entity builds and operates a new facility for the period specified in the project contract.
It will involve high commitment of resources as it involves capital investment like purchasing its own assets in an international country. It involves the highest risk and in turns the chances of highest return.