Question

WJ Group Inc., a large multinational conglomerate, had begun to experience declining revenues over the years. The top management at the headquarters of the company decided that it was important for the company to avoid deviating from its core competencies. Thus, a few of the company's key businesses like energy, telecommunications, and automobiles were centralized, giving the top management more control over them. Also, relatively newer businesses like beverages and food processing were divested. In this scenario, WJ Group is involved in _________

Answer 1

Restructuring.

Step-by-step explanation:

Corporate restructuring is the process ofredesigning one or more aspects of a company. Any substantial change in a company’s business portfolio or financial structure in a way that helps the firm to achieve its objectives and increases the value to shareholders.

The process of reorganizing a company may beimplemented due to a number of differentfactors, such as positioning the company to bemore competitive, survive a currently adverseeconomic climate, or poise the corporation tomove in an entirely new direction. Here aresome examples of why corporate restructuringmay take place and what it can mean for thecompany.

Classification:

- Portfolio Restructuring

- Financial Restructuring

- Organizational Restructuring

Why Companies Undertake Restructuring Practices?

- Regulatory and political change

- Technological change

- Financial change

- Management Ego