1. Examine the types of securities being recommended to RJR as financing alternatives in August 1985. Are they
well suited to RJR’s current liability structure and overall financing program? Why or why not? What other
alternatives might be appropriate at this time?
2. Assuming RJR was to choose among only the alternative presented in the case, which would you recommend?
Be prepared to defend your recommendation analytically.
3. Why is a dual-currency bond being presented to RJR as one of the major financing alternatives? Are the terms
of bond more favorable to RJR or to potential investors? Why might an investor be interested in buying such a
|RJ Reynolds - International Finance, Currency Risk Exposure
Case Study Solution
The RJ Reynolds case study is a Harvard Business School
international financing case. The premise of the case is to select
the best securities for the RJR's current liability structure. The
correct complete solution will answer the three questions below,
defend the answers, and provide financial analysis to support why
the decision is correct for RJR.
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