Divestment is a strategy adopted by the company to remove some of the assets from its current business portfolio. A divestiture often occurs when the company is underperforming. This helps reduce the cost of operations while respecting organizational efficiency and as such, the company is able to generate funds. Acquisition refers to the corporate finance and management strategy, acquiring other business entities to further the financial growth of the company. This is done without necessarily inventing a new activity. Acquisitions and mergers are the main activity for many companies making profits in their respective industries so as to diversify their products, reduce inherent risks, market monopoly and increase their revenues. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essay. In this case, the company should engage in the acquisition of other entities. Economic and political aspects have facilitated the same encouraging business growth globally (Zhang, Ahammad, Tarba, Cooper, Glaister, & Wang, 2015). There are various strategies that make the logic suitable for this company. First, the company has both financial ($150 million in revenue) and operational synergy (more than 2,000 employees). There is an economy of scale for the company and the acquisition of another company will be crucial to improve cost reduction, particularly in sales and marketing, development costs, administrative costs, operational costs and also costs of research. Secondly, since there is enough market for the company, acquiring another company means there will be an increase in market share, the company increases in size leading to monopoly power, so it has the ability to check prices. Orlando is among the most visited places and future projections show an increase in the number of visitors. Third, acquisition is critical to eliminating product line problems. By purchasing the targeted company, the company is able to improve the resources available to its customers. This way you will be able to balance, complement or diversify your products. Finally, since the company has sufficient revenue ($150 million), there is a great need for diversification, both geographically and in product line. Diversification will help reduce earnings risks and challenges that may arise from reliance on a single economy. The financial synergies for the acquisition of this company will be high, as indicated in the stated financial breakdown. This is visible in future projections due to the existence of a lower cost of internal financing compared to external factors. The company has multiple cash flow positions and has various investment options that allow it to achieve a lower cost of capital. The company has exceptional cash flow and therefore needs to divert funds towards other business ventures, thus creating more investment opportunities for future growth. Investing from another business will help reduce the probable risks. The acquisition could be in the same industry or from a different industry. These forms of acquisition have several drawbacks. The acquisition is linked to short-term financial consequences due to the need for a dual back office. Priority must be given to the marketing of the newly acquired company and it must be clear that the expected profits will not be realized in the short term. Customer impact is another issue, in a scenario where the acquisition takes place in the same industrial segment, there is a tendency to increase prices at.