Case study discussion Essay Example | Topics and Well Written Essays - 2750 words

Case study word - Essay ExampleIn this regard, the assets, interests, and rights of the project are basically held as the secondary security or act as the collateral. Therefore, in any case the forecasted cash flow from the project does not pay back the project, there is high risk exposure to debt risks though the failure of the projects may be attributed to many factors similar the interest pass judgment, business risks, economic situation like pretentiousness and the type of the shareholders (Gatti, 2013).In the case of Autopistas del Centro, the financial recession hit the project quite since most of the projected cash flow had been forecasted prior to the massive financial crisis of 2008 (Lubian, 2015). Therefore, the only option it to sell the project to bare-ass owners since the shareholders are reluctant to go into their pockets and cheer the project once. Therefore, it is imperative to identify some of the factors that must be considered when pricing the project so a s to make sure both the buyers and sellers are satisfied. Besides, the head of the projects is deeply concerned about the best advent that can be used to make sure that the shareholders are satisfied with the handing over of the project to the new owners.Inflation is one of the critical issues that must be looked into when pricing a project to the new owners. The implication is that inflation has the potential to increase the original estimates of the construction costs (Esty, 2014). Usually, the inflation rates are set apart into consideration when the project is at the design stage but future changes in the inflation rates may affect the original estimated construction costs and this will have a huge loading on the final pricing of the project (Gatti, 2013). Therefore, when pricing the project, it would be important to look at the inflation rates in Spain, as well as Europe in general. In 2009, the CFO of AC, Martinez saw the need to revise the status of the project finance u nder different circumstances under which the