Divestment is a strategy for the company to remove some of the assets from its current business portfolio. A sale often takes place when the company is underperforming. This helps in reducing the cost of operations, while ensuring organizational efficiency and as such, the business is able to generate funds. Acquisition refers to the business finance and management strategy of purchasing other business entities to contribute to the financial growth of the company. This is done without necessarily creating a new business. Acquisition and merger is the main activity of many companies which make profits in their respective industries in order to diversify their products, reduce inherent risks, market monopoly and increase their revenue. Say no to plagiarism. Get a tailor-made essay on “Why Violent Video Games Should Not Be Banned”? Get Original Essay In this case, the company should engage in acquisition of other entities. Economic and political aspects have generally facilitated the same encouraging business growth (Zhang, Ahammad, Tarba, Cooper, Glaister, & Wang, 2015). There are various strategies that make justification suitable for this business. First, the company has both financial ($150 million in turnover) and operational (more than 2,000 employees) synergy. There is an economy of scale for the company and by acquiring another company it will be vital to improve cost reduction, particularly in terms of sales and marketing, development costs, administrative, operational costs as well as research costs. Second, since there is enough market for the company, acquiring another company means that there will be increased market share, as the company increases in size, leading to monopoly power, it therefore has the ability to control prices. Orlando is one of the most visited places and future projections show an increase in visitors. Third, acquisition is crucial to eliminate product line issues. By purchasing the target company, the company is able to improve the resources available to its customers. In doing so, it will be able to balance, complement or diversify its products. Finally, since the company has sufficient revenue ($150 million), there is a great need for diversification, both geographically and even in terms of product line. Diversification will help reduce revenue risks and challenges that could arise from reliance on a single economy. The financial synergies for the acquisition of this company are expected to be high, as indicated in the financial breakdown shown. This is visible in future projections due to the existence of a lower internal financing cost compared to external factors. The company has different cash flow positions and has various investment options to reduce the cost of capital. The company has exceptional cash flow and therefore needs to divert the funds to other projects, creating more investment opportunities for future augmentation. Investing in the other company will help reduce the likely risks. The acquisition can take place in the same sector or in a different sector. These forms of acquisition have various disadvantages. The acquisition is linked to short-term financial consequences due to the need for a duplicate back office. Marketing the newly acquired business should be a priority and it should be.